Oral Answers to Questions

FOREIGN AND COMMONWEALTH OFFICE

The Secretary of State was asked—

Burma

John Bercow: What recent representations he has made to the Government of Burma on the renewed detention of Aung San Suu Kyi.

Meg Munn: My right hon. Friend the Prime Minister and President Sarkozy of France jointly called for Aung San Suu Kyi's immediate release on 19 June, her birthday. My right hon. Friend the Foreign Secretary deplored the extension of her house arrest on 27 May. We worked to ensure that the European Council and the United Nations Human Rights Council issued calls for her release in the past week.

John Bercow: I am grateful to the Under-Secretary for that informative reply. Given that the illegal, immoral and intolerable detention under house arrest of Aung San Suu Kyi for more than 12 years is but one example of the Burmese Government's egregious human rights abuses, which include rape as a weapon of war, extra-judicial killings and the active denial of aid to hundreds of thousands of people following Cyclone Nargis, will she work with her international counterparts to press the United Nations Security Council to refer the Burma Government's conduct to the International Criminal Court?

Meg Munn: I am sure that all hon. Members agree with the hon. Gentleman's sentiments. He will appreciate the difficulties of getting a resolution through the Security Council on those matters. At the moment, we are concentrating on seeking an authoritative assessment of the situation on the ground. The UN Human Rights Council agreed a resolution by consensus, which calls for the regime to give full access to all parts of Burma.

Barry Sheerman: Does my hon. Friend appreciate the amount of frustration felt in this country at our inability to effect any change in this wicked regime and its attitude to that fine woman? Does she realise that even moderate Members of Parliament such as me would change their minds about a boycott of the Beijing Olympics if we found that, in Burma, as in Zimbabwe, China is the block on anything being done by the international community?

Meg Munn: Of course, I appreciate the frustrations that many people feel in this country about the lack of change in Burma. We have succeeded in getting aid into Burma, especially with the help of the Association of South East Asian Nations countries in the region. China agreed with the consensus on the UN Human Rights Council declaration. On that basis, we believe that we can continue to work with China to put pressure on the Burmese regime.

David Burrowes: Will the Government ensure that sanctions are tougher, more targeted and hit the military junta where it hurts, not least on arms? Will they also ensure that international aid from taxes and charities does not unwittingly get into the despicable junta's hands?

Meg Munn: On the latter point, I reassure the hon. Gentleman that aid in Burma goes through the UN and non-governmental organisations on the ground. On the first point, our sanctions in the European Union are designed to do exactly what he said: to be targeted on the regime, through, for example, timber, precious gems and so on. We are also doing further work to ascertain whether any financial sanctions could have the same effect.

Julie Morgan: I am sure that my hon. Friend will be pleased to hear that, in Cardiff on Saturday, nearly 200 people attended an event to mark Aung San Suu Kyi's 63rd birthday. Does my hon. Friend agree that, following the referendum, which many people consider rigged, Burma's new constitution will effectively debar Aung San Suu Kyi and her party from taking part in the democratic process? What can she do about that?

Meg Munn: I congratulate my hon. Friend and the people of Cardiff, who keep the issue in the public eye, which is essential. She is right that the constitution has no legitimacy. Indeed, it is incredible that anyone could believe that the referendum was fair. The constitution is flawed and would debar Aung San Suu Kyi, and we continue to call for a proper process, which includes all those in Burma who have an interest in the development of democracy—Aung San Suu Kyi and all the leaders of the different ethnic groupings.

Keith Simpson: I see that the Foreign Office has a special representative, whose responsibilities cover the wider middle east, including Iraq and Iran, as well as the middle east peace process. He is also responsible—rather bizarrely—for Burma. Has that representative been involved in any negotiations with the Burmese Government on the issue that we are considering and others? When did he last visit Burma?

Meg Munn: The hon. Gentleman refers to Michael Williams, who has been very involved in our work on Burma. He has spent a great deal of time travelling in the region and speaking to countries there about the pressure that they can bring to bear. He also attended the donors conference in Burma at the end of May with my right hon. Friend the Secretary of State for International Development.

Lindsay Hoyle: My hon. Friend would recognise that Aung San Suu Kyi has been completely failed by the international community. Whichever way we look at it, we see that there have been 12 years of imprisonment and a lot of fine words, but absolutely no movement and an evil regime still in place. What can we do, other than just having fine words from all the different nations? What sanctions can we put in place to overthrow the Government in that country?

Meg Munn: The truth is that neither sanctions by the international community nor engagement by countries in the region has brought about the result that we would desire. In the aftermath of Cyclone Nargis, we have seen something of a change in the neighbouring ASEAN countries, which are now indicating more vocally that they believe that things need to change in Burma. We will continue to work with those countries and with the United Nations. Ban Ki-moon has said that he will return to Burma later this year, following up his visit after the cyclone. We are hopeful that that will enable us to move the political process forward in the right direction.

Baha'is (Iran)

Tom Brake: What recent reports he has received on the situation of Baha'is in Iran; and if he will make a statement.

Kim Howells: When I raised with the Iranian ambassador to London the UK's great concerns about reports of maltreatment of adherents of the Baha'i faith in Iran, he told me that Baha'ism is not officially recognised as a religion in Iran. We receive reports that Iranian Baha'is face routine discrimination and harassment on the grounds of their faith, and the informal Baha'i leadership has been detained for more than a month now. We remain deeply concerned by the situation of the Baha'is in Iran and will continue to raise our concerns with the Iranian authorities.

Tom Brake: I thank the Minister for his response. He will be aware of reports from Iran that a new penal code is being drafted, which will be considered by the Iranian Parliament, that would introduce a mandatory death sentence for apostasy. The code would have extra-territorial jurisdiction and could lead to a fundamental attack on the human rights of Christians and Baha'is, particularly those with one Muslim parent, who could, under the new law, be considered apostates. Will the Minister confirm what action the Government are taking on the issue, in particular with the international community, to remind Iran of its responsibilities under international law, in particular article 18 of the international covenant on civil and political rights?

Kim Howells: Yes, I can confirm that the new draft penal code is currently being considered by a judicial committee in the Iranian Parliament, but it has not yet been debated or voted on in plenary. We are very concerned that the draft code makes apostasy punishable by death and that the provisions contravene the principle of religious freedom. We are worried about the impact that they would have on religious minorities in Iran, including Christians, as the hon. Gentleman said, and the Baha'i community.
	We have certainly made representations to the Iranian Government about the matter. The EU issued a statement of concern on 25 February and raised its concerns with Iranian officials in Tehran on 4 March. I called in the Iranian ambassador to express the UK's concerns on 1 April. We are keeping a close watch on the issue, and I very much hope that our concern will help to galvanise international opinion against this barbaric proposal.

David Lepper: As an officer of the all-party friends of the Baha'i faith group, may I thank the Minister for the representations that he and others have made to the Government of Iran about the situation of individual Baha'is whose cases we have drawn to his attention? Will he also make representations to the Government of Iran about the denial of access to higher education of young Baha'is in that country? Of some 200 Baha'is who began university courses in autumn 2006, about 130 have since been expelled on the grounds of their religious faith. Will the Minister raise that point with the Government of Iran, too?

Kim Howells: Yes, we will certainly raise it with the Government of Iran. That is one example of the way in which Baha'is in Iran are being marginalised because of their beliefs. That is wholly without justice and is a very worrying development.

Mark Pritchard: The Minister will know that not only Baha'is, but Christians and indeed homosexuals often face torture and sometimes even death in Iran. Does he therefore share my concern about the recent alleged comments made by the Home Secretary when asked about failed asylum seekers who are openly homosexual, that they should return to Iran and be discreet in their sexuality? Given that there is no discretion, with the eyes of the state constantly on the gay community in Tehran and Iran more widely, does the Minister want to put it on record that he perhaps has a different view?

Kim Howells: I am completely unaware of the alleged statements made by my right hon. Friend the Home Secretary, but I am only too willing to put it on record that people should not be punished in any way for the way in which their sexuality guides them. They should certainly not be tortured, imprisoned and hanged, as they have been in Iran.

Middle East (Egypt)

Eric Joyce: What recent discussions he has had with the Government of Egypt on the middle east peace process.

David Miliband: I spoke to the Egyptian Foreign Minister yesterday about the middle east peace process. I thanked him for Egypt's efforts in bringing about a ceasefire between Israel and Hamas. It is vital that the ceasefire now holds, allowing the humanitarian situation to improve and bringing to an end the rocket attacks on southern Israel.

Eric Joyce: I thank my right hon. Friend for that answer. I agree that the Egyptians have made commendable efforts in the last short while. Does he agree, however, there is a great deal more that they could do? I hope that they would agree that that is the case as well. I am thinking in particular of the tunnelling under the border, which is continuing, and the smuggling of people and dangerous contraband.

David Miliband: My hon. Friend raises an important point. He will know that smuggling is a long-term issue that is a threat to Egypt as well as something that just goes through the country. This is intimately related to the crossings between Gaza and Egypt, and the crossings into Israel. As soon as we get properly organised legal traffic going through those crossings, which is a priority for all sides, there will be a parallel commitment to crack down on the smuggling that is a threat to all the countries in the region.

Sarah Teather: I welcome, as did the Foreign Secretary, the ceasefire between Hamas and Israel. Does he agree, however, that there is now a pressing need to ease the blockade on Gaza? I went to Gaza two months ago, and I was horrified by the crippling poverty there, and particularly by the impact of the blockade on health services. In his discussions with Egypt and with Israel, has he had specific talks about the passage of patients across the border to access better health care? I certainly saw individuals being denied that health care.

David Miliband: The hon. Lady raises an important point, and it is one that we raise particularly in respect of health supplies, and in general in respect of fuel, electricity and other traffic into the Gaza strip. It is important to say that we are not just calling into thin air for improved access to Gaza on humanitarian grounds. As part of the agreement, Israel itself has committed to improving the flow of goods services, and all the independent estimates—and statements by Hamas and by Israel itself—show that there has been an improvement of, I think, about 30 per cent. during the first three days of the ceasefire. That is certainly something that we should encourage all sides to build on.

Mike Gapes: The Foreign Secretary referred to the Rafah crossing. He will aware that the opening of that crossing in 2006 was negotiated after a lot of effort by the US Secretary of State, Condoleezza Rice. What recent discussions has he had with Condoleezza Rice about the prospects, seven months on, for securing the Annapolis process agreement?

David Miliband: On almost every occasion that I meet or speak to Secretary Rice, we discuss the situation in the middle east. We certainly did so on Sunday, when I last spoke to her, and I will obviously meet her at the G8 Foreign Ministers' meeting on Thursday in Japan. I know that the middle east will be a major topic there, and we are looking forward to her latest report on her recent visit, and also to having further discussions on how to advance a process that, I think it is fair to say, is slightly more promising than it would have been in a Question Time two or three weeks ago. The developments in Gaza and the Lebanon, and the opening of the Israel-Syria talks, are creating a more propitious environment for the Israeli-Palestinian track. It is important that we should not get carried away by any sense of optimism, but there are some important stirrings there.

Douglas Carswell: Can the Minister give me an assurance that there will be no negotiations with Hamas by the British Government until the three Quartet principles have been met and upheld?

David Miliband: Yes, we certainly stick to the Quartet principles. It is important to say, however, that the lack of contact is not the real issue in respect of Hamas. The real issue is the choice that it has to make about the role that it wants to play in the future. The Norwegians have publicised the fact that they are talking to Hamas, and Hamas has obviously been involved in discussions with the Egyptians over the humanitarian situation in Gaza. The announcement by President Abbas that he wanted to re-establish Palestinian unity on a basis that recognised the state of Israel, that renounced violence and that respected previous Palestinian agreements was the right way forward. It is important that we take our cue from President Abbas on this matter.

Gerald Kaufman: In congratulating the President of Egypt on, and thanking him for, the key role that he has played in bringing about the ceasefire between Hamas and the Israelis, will my right hon. Friend say whether when he has his discussions with Secretary of State Condoleezza Rice, he will also discuss with her the continued expansion of illegal Israeli settlements on the west bank, which are against international law and which President Bush to his credit—a very rare thing—has denounced?

David Miliband: Yes; my right hon. Friend has made his own position clear and I have made the Government's position clear from this Dispatch Box on many occasions: the requirement on all sides to live up to their road map commitments does indeed apply to all sides. The Israeli commitment in respect of settlements needs to be honoured. There is significance in what President Sarkozy said in Israel yesterday and in what President Bush said there the week before. There is real determination in the international community to hold on to the idea that 2008 has to be made into a key year for the middle east peace process. There has not been such a process for seven years; there is one now, and it is precious, so we need to ensure that we make some progress.

Human Trafficking (Romania/Bulgaria)

Anthony Steen: If he will meet his counterparts in Romania and Bulgaria to discuss human trafficking.

Jim Murphy: I met Bulgaria's Europe Minister earlier this month and discussed a range of rule of law issues. The Under-Secretary of State for the Home Department, my hon. Friend the Member for Gedling (Mr. Coaker), has recently visited both Romania and Bulgaria to discuss a number of issues, including those relating to human trafficking.

Anthony Steen: In light of the Foreign Office's responsibility for dealing with human trafficking under the Government's action plan, does the Minister think it sensible to discuss with his opposite number the possibility of our embassies in both Bucharest and Sofia doing more to raise awareness of the scale of human trafficking in Bulgaria and Romania? Hundreds and thousands of children from poor Roma communities are sold into slavery every year, so should not our embassy be doing more? Could we not lead a crusade in eastern Europe with other embassies to raise the whole profile of the trafficking problem in eastern Europe?

Jim Murphy: The hon. Gentleman raises entirely reasonable points and I hope that he is reassured that our embassies in both Bulgaria and Romania are working very hard on these issues. That is not to say that we cannot continue to look for additional initiatives and energies to expend. He rightly draws attention to the trafficking of children in particular, and it may help the House if I say that intelligence reports have identified a network of ethnic Roma criminals involved in the trafficking of Romanian Roma children, particularly to the UK. Police forces in the UK have identified more than 200 children being exploited in London and beyond. We are grateful for the co-operation that we have with the Governments of Bulgaria and Romania, but there is more that we can do together.

Ann Cryer: Is my hon. Friend quite satisfied that the Russian Federation is doing enough to halt the flow of trafficked people through its territory?

Jim Murphy: I know that the Russian Federation is committed to controls on people trafficking, but it is certainly the case that, across the European Union and the wider sphere of Europe, there is far too much people trafficking, with criminal gangs exploiting the vulnerability of often frail and desperate people in a vile and sick trade. We do all we can in the EU through the European neighbourhood policy and much else besides, but if my hon. Friend has specific additional points that she would like Her Majesty's Government to address with the Russian Federation, I am always happy to listen.

Paul Beresford: I would like to re-emphasise the concern over child trafficking, especially of babies, for all sorts of purposes—slavery, sex and so forth. The Minister says that we can do more. What does he have in mind?

Jim Murphy: The fact is that as these criminal gangs become more sophisticated, we always have to develop new ways to deal with them. Working with Save the Children in Romania is one important example of what we need to do, and the voluntary return of children, if their safety and well-being can be guaranteed, is another. We continue to discuss such issues with the Governments of both Bulgaria and Romania. As I say, as the challenge changes and these gangs become more sophisticated and in some ways more subtle, we have to be equally determined and flexible in our efforts.

EU Presidency

Robert Syms: If he will make a statement on the agenda of the French EU presidency.

Jim Murphy: My right hon. Friend the Prime Minister said to the House yesterday that we will continue to focus on an outward-looking European agenda. We look forward to working with the French presidency on climate change, defence and security, migration, and rising food and fuel prices.

Robert Syms: Should not Her Majesty's Government be impressing it upon the French presidency that the kindest thing for the treaty of Lisbon is to let it die? The people of Europe do not want it. Some of the matters that the Minister raised at the Dispatch Box a few moments ago are far more important for the people of Europe than this treaty.

Jim Murphy: The fact is that the United Kingdom Government will not seek to decide, determine or dictate to the Irish Government regarding their next move. It is for the Irish Government to make their decision. I offer an observation in passing: as has been said, the Lisbon treaty is the first treaty that officially recognises children's rights across the EU. Previous treaties recognised animal rights; this treaty recognises children's rights. That is an important innovation and improvement.

David Taylor: Was not President Sarkozy right at the weekend when he said to the former Member for Hartlepool—the future Lord Mandelson, no doubt—that he was responsible for the Irish "No" because of his free trade policies, which frightened Irish farmers into the no lobby? Does the Minister agree with that assessment and does he recognise that the laissez-faire attitude of the EU and its undemocratic roots are having a similar impact on the core vote that might have supported continued membership in this country?

Jim Murphy: I thank my hon. Friend for the gracious way in which he carefully put his point. I do not agree with him, however. I think that Peter Mandelson is doing a fantastic job as Commissioner.  [Interruption.] I had thought, until today, that the Conservative party supported reform of the common agricultural policy as we continue a wider review and reform of Europe's budget so that it reflects the future, rather than the historical past of massive subsidies being paid to farmers instead of protecting the environment.

Angus Robertson: It would be welcome if the French presidency looked closely at the European neighbourhood policy. A great many projects previously supported by member states are now part of the ENP. Does the Minister agree that, with close attention from the presidency and the Commission, those projects can go from strength to strength?

Jim Murphy: I do agree, and I had the opportunity to meet the hon. Gentleman yesterday to discuss many of those issues. Europe has substantial influence in countries on its borders, both to the east and to the south. That is a responsibility and an opportunity, and we should seek to maximise our influence on democracy, the rule of law, human rights, penal reform and a range of other matters. He is absolutely right, and the French presidency shares our ambitions for a European neighbourhood policy that seeks to do more in supporting human rights and democracy.

David Heathcoat-Amory: The Minister for Europe mentioned the problem of high energy prices, but EU policy on climate change and the directive on renewable energy and biofuels will increase energy prices further, so can we have some consistency here? Will the Government stop complaining about high energy costs while supporting measures that will increase them further?

Jim Murphy: In response to the point raised by the former Minister for Europe, I point out that it is important to reflect the fact that the EU is working on an energy policy and a climate change policy that are about transparency in the market, matching supply and demand, investment in climate change technologies such as carbon capture and storage, and so much else besides. That variety of policies plays an important role in supporting our economies, but also in protecting our environment.

Mark Francois: The people of Ireland clearly rejected Lisbon by an emphatic margin on a record turnout, since when  The Economist has wisely advised the Government, "Just bury it". Will the Minister answer the question that the Foreign Secretary clearly ducked last week and assure the House that no further work on the External Action Service will be undertaken by British officials, including during the French presidency?

Jim Murphy: The Foreign Secretary was very clear on this point, as was my right hon. Friend the Prime Minister: in light of the Irish referendum result, plans to have discussions on the External Action Service at the General Affairs Council and the European Council were cancelled. That was the right response to the referendum in Ireland. No further work will be carried out, and the work has stopped in the UK until such time as there is a new suggestion from the French presidency or a way forward suggested by the Irish Government. That is very clear.

Palestinian Occupied Territories

Crispin Blunt: What assessment he has made of compliance of the operations of the Israeli defence force in the occupied Palestinian territories with the fourth Geneva convention.

Kim Howells: We expect Israel, including the Israeli defence force, to comply with its obligations under the fourth Geneva convention, and have made clear where we profoundly disagree with Israel on key issues, such as the route of the barrier and location of settlements. The Annapolis talks provide the best opportunity yet to move forward. The announcement of a ceasefire in Gaza was welcome. We are doing all that we can to help to relieve suffering and move towards resolution of long-term issues.

Crispin Blunt: I am grateful to the Minister for that answer, and agree with his points. I am interested, however, to know what he means by "location of settlements". Article 49 of the fourth Geneva convention is extremely clear that colonisation of occupied territory is illegal. The settlements in all of the occupied territory are the biggest physical obstacle to a settlement between the Palestinians and the Israelis. Now that a ceasefire is in place, surely the Palestinians can expect us to pursue the matter under international law. What kind of signal does it send when settlers' leaders are then invited by Her Majesty's ambassador to Israel to a party celebrating the Queen's birthday?

Kim Howells: Not very helpful signals, and I agree entirely with the hon. Gentleman that this is the time to push the Israelis hard on the question of illegal settlements. Clearly, they are illegal and are not helping the Annapolis process in the least. Indeed, they are an obstacle to progress.

Jeremy Corbyn: Can the Minister help us with another question concerning the role of the occupying forces in Palestine: the imprisonment of elected Palestinian parliamentarians, about 70 of whom are still in detention, which is outrageous? If we support Palestinian democracy, what pressure are we putting on Israel to release those who were elected to represent the Palestinian people?

Kim Howells: We continue to raise the issue with the Israelis, and continue to urge them either to charge those individuals or release them—it is as simple as that. They are elected representatives and should be treated as such. If the Israelis believe that they are guilty of some crime, they should charge them, not keep them incarcerated without a proper trial.

Lee Scott: In the Minister's opinion, is the continued holding of hostages by Hamas, Hezbollah or whoever helpful to the peace process? Under the current ceasefire, will further pressure be exerted to release the Israeli hostages?

Kim Howells: The taking of hostages was not only a despicable act in itself, and it remains so—kidnapping is always one of the worst crimes—but caused thousands of deaths in the Lebanese war of July 2006. We urge the Palestinian and Hezbollah factions to release the Israeli soldiers. That would be a concrete and important step towards a sustainable peace in that region.

David Winnick: Is it not the case that in Israel too small a minority, unfortunately, realise that the behaviour of the Israeli soldiers and armed forces generally in the occupied territories demonstrates, day in and day out, a contempt for human rights? Have the Israeli Government any understanding of the contempt that we have for the way in which their country occupies the post-1967 territories?

Kim Howells: I certainly do not believe that all officers and all men in the Israeli army behave in that way. Many soldiers, including many whom I have met, have a real regard for human rights—the human rights of Palestinians as well as of Israelis. We will continue to urge Israel to abide by international law in its treatment of Palestinians in those occupied territories, and to work towards a sustainable settlement so that the Israeli defence force does not need to be in those areas. That must be our object, and we believe that a two-state solution is the right one.

Richard Burden: I welcome my right hon. Friend's comments about settlements, but given that the website of the Israeli Ministry of Construction and Housing lists 4,900 housing units that are currently in the construction programme, may I ask him what response is coming from Israel to our representations on the matter, particularly in relation to the E1 scheme?

Kim Howells: I should like to think that my hon. Friend had inferred that our actions were having some effect, but I do not think they are having a great effect. The latest announcements—within the last few weeks—of 1,000 new dwellings on occupied territories are doing no good whatever to the Annapolis process.
	When I met Prime Minister Fayad in Berlin last night, he repeatedly referred to the issue of illegal settlements as one of the greatest impediments to progress on Annapolis. My hon. Friend is right: we must keep plugging away, and trying to convince the Israelis that this is one of the most important steps forward that they could take.

Louise Ellman: When my hon. Friend assesses Israel's reactions to attacks on its citizens, does he bear in mind that false allegations can be made? Is he aware, for example, that Hamas has now admitted that the explosion that killed 50 people on 13 June was not Israel's responsibility?

Kim Howells: My hon. Friend is right. I have seen and heard many reports of truck-loads of rockets intended to be fired into Israel that have been hit or handled badly and have exploded. People have been killed, including onlookers and innocent people in the streets of Gaza. I take reports of that kind with a pinch of salt, and I think we all should. The fact is that there is a propaganda war going on in the area, as well as a deadly war involving bullets, bombs and rockets.

Yemen

Keith Vaz: If he will visit Yemen within the next six months to discuss relations with the UK and regional issues.

Kim Howells: Foreign engagements for my right hon. Friend the Foreign Secretary and other Ministers are kept under constant review. We do not announce visits until they have been confirmed, and final decisions on overseas visits are often not possible until shortly before the day of travel. Last month, however, I paid my third visit to Yemen. It included a visit to Aden, which I know is a place close to my right hon. Friend's heart.

Keith Vaz: I welcome the fact that the Minister went to Aden, the city of my birth, and acknowledge the fact that he returned from his visit. No one fired any shots at him, no one directed any bombs at him; he came back safely. So why does the Foreign Office continue to pursue a travel advice policy that prevents business persons and tourists from going to Yemen? Surely the best way in which to ensure good relations with the country is for us to allow our people to engage with the people of Yemen.

Kim Howells: My right hon. Friend will know as well as I do that civil unrest in Yemen is growing. There are grievances throughout the country. Al-Houthi-led rebels in the north have been exploding bombs, and indeed exploded bombs while I was there, although luckily out of my earshot for a change. There is also a great deal of disquiet in the south, even around Aden. As my right hon. Friend will know, people in the south feel that they are not receiving the investment that they should be receiving for their industries and infrastructure.
	There is a great feeling of unease. Tourists have been kidnapped, and although they have not been British tourists—thank goodness—I am not sure that I would like to ease that travel advice and then find that as a consequence someone caught up in a bomb outrage had been killed or maimed, or someone had been kidnapped or shot. I am sorry to say that, because Yemen is a very beautiful country which ought to be prospering as a result of tourism.

Daniel Kawczynski: When the Minister next meets the Yemeni authorities and those of neighbouring countries, will he raise the concern that is felt about the increasing piracy off the coast of the horn of Africa around Somalia and Yemen and the effect that that is having on international shipping?

Kim Howells: Yes. It is an extremely serious problem. The hon. Gentleman will be glad to know that the British Navy and the British coastguard service have been co-operating closely with the Yemeni—

Patrick Cormack: The Royal Navy.

Kim Howells: I am sorry: the Royal Navy.  [Interruption.] No, not the Welsh navy. The Royal Navy has been co-operating very closely with the Yemenis on this. The authorities in Somaliland and Djibouti, which are also exercised about the problem, are now beginning to co-operate with Yemen to try to eradicate it, but it does not just involve piracy. There is an enormous amount of people trafficking, and an enormous number of people are drowning as they try to make the crossing from the horn of Africa to the Saudi peninsula.

Ann Clwyd: As my hon. Friend knows, the Yemeni constitution guarantees freedom of expression, but in reality that is not the case. Will he take up the case of Yemeni journalist Abdul Karim al-Khaiwani, who was sentenced to six years of imprisonment on 9 June? Amnesty International considers him to be a prisoner of conscience, as he has been convicted and sentenced solely because of something he wrote. Last week, he received an Amnesty award, among its annual awards, for his work, and I ask the Minister to take up his case and ask for his release.

Kim Howells: I would be only too glad to take up this case.

Iran (Nuclear Programme)

Andrew MacKay: What recent assessment he has made of developments in the Iranian nuclear programme; and if he will make a statement.

David Miliband: Dr. el-Baradei, the International Atomic Energy Agency director general, reported on Iran's nuclear programme on 26 May. I spoke to him last week about his report. He confirmed that Iran had failed to suspend enrichment-related activities; had made no progress on transparency measures, for which the United Nations Security Council and the IAEA had called; and had failed to answer the IAEA's questions relating to studies with a possible military dimension. He said that these studies were a "matter of serious concern", and they are the subject of continuing IAEA investigation.

Andrew MacKay: Why did the Prime Minister say on 16 June, after his meeting with President George Bush, that that day he would take action that would immediately freeze the assets of Iran's biggest bank, Bank Melli, when many days later that clearly still has not happened?

David Miliband: I am sorry that the right hon. Gentleman says that has not happened, because there was political agreement at the Foreign Affairs Council that I attended last Monday, and yesterday the formal technical procedure that froze the assets of Bank Melli went through the European Union. I would have thought that that would be welcomed in all parts of the House.

Douglas Hogg: The Foreign Secretary will have seen the reports over the weekend that the Israeli Government were carrying out exercises that suggested a possible long-term intention to attack Iran and her nuclear establishment. Will the Foreign Secretary make every effort to persuade the Israeli Government that such an action would be profoundly unwise?

David Miliband: I am very happy to confirm to the right hon. and learned Gentleman that we are 100 per cent. committed to the pursuit of a diplomatic resolution to the problem in respect of Iran's nuclear intentions, which are, of course, a threat to stability right across the region. There is now an ever wider coalition ready to put pressure on the Iranian regime, and also to try to make it clear to the Iranian people that a major offer of economic, cultural and scientific co-operation is waiting for them. The economic malaise that currently afflicts Iran is the result of the choices made by the Iranian Government, but there is an alternative for them, and we are committed to make sure that the sanctions and incentives reflect that.

David Lidington: The Foreign Secretary will recall that the Prime Minister promised in his Mansion house speech last November tougher sanctions on oil and gas investment in Iran, and yet only last week in his joint press conference with President Bush, the Prime Minister said:
	"Action will start today in a new phase of sanctions on oil and gas."
	I wonder whether the Foreign Secretary can explain the reasons for this seven-month delay, and does he accept that if Ministers threaten sanctions and then fail to deliver them, all they end up doing is undermining the credibility of any threat this country can make?

David Miliband: I am genuinely sorry that the hon. Gentleman has taken that tack because actually there is agreement across the House that a sanctions and incentives dual track is the right approach to Iran. There is agreement—from Iran to the United States, to this country and to any independent observer—that the sanctions are having an effect on the Iranian economy. The Bank Melli decision has been implemented, as of yesterday, and UN resolution 1803 has been fully implemented and the further sanctions to which he referred. Although the International Atomic Energy Agency discussions were completed only in May, there is the report to the IAEA board, and, as I said, UN sanctions resolution 1803 is now to be implemented. There should be a shared commitment to see those fully in force. The fact that, side by side with those measures, there is a revived offer to Iran is a good thing, not a bad thing, and I am sorry that the hon. Gentleman has tried to create division about that.

Lebanon

Andrew Love: What assessment he has made of the prospects for achieving sustainable peace in Lebanon following its recent presidential elections.

David Miliband: The Doha accord and the election of President Sleiman were important steps forward for Lebanon, but the situation remains extremely fragile. It is now vital that a national unity Government be formed as soon as possible. During my recent visit to Lebanon earlier this month, I underlined my strong support for President Sleiman and Prime Minister Siniora, including through $4 million of UK support to the Lebanese security sector that will be so important in rebuilding the confidence of the citizens of that country in their armed forces.

Andrew Love: We certainly do need to rebuild confidence, because earlier this year they had gone to the brink, almost reaching civil war. The Doha agreement has proved the way forward, yet the situation remains deeply unstable and tense; indeed, I understand that troops were called out onto the streets of Tripoli today. What more can my right hon. Friend do, particularly in using his good offices, to ensure that a Government are elected at the earliest opportunity? That is the way that we can bring greater stability not only to Lebanon but throughout the middle east.

David Miliband: I know that my hon. Friend has championed the importance of Lebanon not just to the Lebanese people but in terms of security and stability across the middle east, and he is absolutely right to do so. I think that it is the nomination of a Government that is currently held up, and I spoke to Prime Minister Siniora about that when I was in Lebanon and last week, in advance of yesterday's and today's conference in Austria on the rebuilding of the Palestinian refugee camps. The nomination of the Government will take place and, next year, there will also be elections for a new Government. I very much hope that all the parties will recognise their interest in pursuing a stable strategy in advance of those elections, and in allowing them to take place in conditions as close to normality—certainly without violence—as possible.

Topical Questions

Robert Goodwill: If he will make a statement on his departmental responsibilities.

David Miliband: I spoke in the House yesterday of the appalling campaign of state-sponsored violence that made a free vote in Zimbabwe impossible. I welcome yesterday's UN presidential statement, the first from the UN Security Council, condemning the violence and demanding that the Zimbabwean Government respect basic political freedoms. Regional and international partners need urgently to ensure that the democratically elected will of the people of Zimbabwe, reflected in the results of the 29 March election, be respected.

Robert Goodwill: In the past, the British Government have been accused of pussyfooting around the issue of human rights in Uzbekistan, partly because of the need for the Americans to use bases in that country. What is the current assessment of political and human rights in that country, in particular with regard to child labour in the cotton fields?

Jim Murphy: The hon. Gentleman is correct about the worrying reports of human rights abuse in Uzbekistan as detailed in the Foreign Office's annual report on human rights. We raise this issue regularly, bilaterally and multilaterally. There are very worrying reports of child labour in the cotton industry. We have raised these matters with the Government, but we also support the demand of UNICEF and the International Labour Organisation for an external examination and oversight of what is happening in the Uzbek cotton industry, so that those reports can be discounted or proven once and for all, and then action can be taken.

Phil Wilson: Will the Foreign Secretary comment on the capacity of the Palestinian Authority to provide security for their own people, and outline what came of the Berlin security conference?

David Miliband: My hon. Friend raises a very important point. I was able to see for myself in Jenin the real efforts being made by the Palestinian security forces, and I am pleased to say that those are successful efforts to bring new security to that city and effectively to end the occupation. For the first time in the occupied Palestinian territories, there has been a withdrawal of Israeli defence force troops and the installation of the Palestinian security forces. We are big sponsors of the Palestinian security forces financially, but also through the mentors whom we provide there. I believe that my hon. Friend the Minister for the Middle East discussed the matter with Prime Minister Fayad last night in Berlin. The critical thing is that the successes in Jenin are now repeated in other parts of the west bank.

William Hague: May I join the Foreign Secretary in welcoming the UN presidential statement on Zimbabwe and ask him whether the Government will now put forward a concrete set of proposals for European Union sanctions on the Mugabe regime that are more serious, more far-reaching and more rigorously applied than anything that we have seen in the past? Will they include, in particular, a full visa ban for Mugabe, his officials and their families and associates, a range of financial measures, including an assets freeze on institutions complicit in the regime's abuses and a ban on their transactions, and a guarantee that there will be no more invitations to European Union summits for a criminal Government who have lost all legitimacy?

David Miliband: I am pleased to tell the right hon. Gentleman that no such summit is currently in prospect. I can assure him that all the options that he has described will be discussed at European Union level; last night, I spoke to the Dutch Foreign Minister. This is not Britain against Zimbabwe; the whole of the European Union now wants to recognise the importance of the situation. On the basis of two recent phone conversations and exchanges with Mr. Kouchner, the French Foreign Minister, I am pleased to say that the incoming French presidency wants to give this matter priority too.

William Hague: We hope that these measures will be not only options but British and French proposals in the coming days. May I additionally ask the Foreign Secretary, particularly in the light of the African National Congress statement today, which is much more critical than the South African Government have been of the situation in Zimbabwe, whether he has had any indication of any change in South Africa's policy? Given that President Mbeki has been invited to the G8 summit in two weeks' time, where Africa and development is on the agenda, will the Prime Minister and the Foreign Secretary try to ensure that the G8 communiqué calls specifically on all nations present at that summit to cease any actions that prop up a regime that is doing untold damage, both to Africa and to development, and thus give appropriate voice to world opinion on the conduct of the South African Government?

David Miliband: I think the whole House united yesterday in recognising the importance of South Africa to change in Zimbabwe. The right hon. Gentleman asked whether I had been given any indications about a change in the South African attitude, perhaps suggesting some private conversations. One can look at the public actions of South Africa, notably in the UN Security Council yesterday, when the presidential statement was published—it is available on the website—by unanimity. South Africa and China, countries that were mentioned in yesterday's discussion, signed up to language condemning the Mugabe regime, both for its humanitarian abuses and for the way in which it tried to rig the election—or made the election impossible— and calling on African leaders to take steps forward. On the G8, the Prime Minister and I will certainly be arguing for the most effective and strongest possible G8 and G8 plus five communiqué to address all our responsibilities to tackle those issues.

David Wright: On one of the hottest days of the year so far, may I turn the minds of Ministers towards Antarctica—the two are, of course, linked? What are we doing to preserve the great wilderness that is Antarctica and to ensure that we use the resources that are there in abundance very carefully?

Meg Munn: It is a pleasure to answer my first ever question on Antarctica. The protection of the Antarctic environment is enormously important and is provided through the 1991 protocol on environmental protection to the Antarctic treaty. My hon. Friend will know, given his interest, that that treaty has so far been successful in preserving Antarctica as a natural resource devoted to peace and science. It is an example of the international community working together to achieve that aim, and I assure him that this Government will continue to give it their full support.

John Baron: The Iranian Government are reportedly sympathetic to the idea of an international consortium enriching uranium on Iranian soil. Given that that would allow western powers to be involved with, and to oversee, enrichment and the harnessing of nuclear power for civilian use, would the British Government back such an idea?

David Miliband: The hon. Gentleman will know from the package that was presented to the Iranian Government 10 days ago, and has now been published right round the world, that we believe that there is a future for civilian nuclear power generation in Iran. However, the history of Iran's failure to be open and transparent with the international community about its nuclear intentions has gravely undermined confidence. Therefore, at this stage it is right to talk openly and plainly about continued commitment to shipments of uranium into Iran, for example for the Bushehr reactor, for which the Russians are responsible. It is right that we are willing to open discussions with the Iranians should they first freeze and then suspend their uranium enrichment programme. It is premature for us to say that we know that there is one single answer of the sort to which the hon. Gentleman refers. We have to recognise that confidence has been gravely undermined and needs to be rebuilt step by step as the Iranians show themselves to be a trustworthy partner of the international community.

Anne Moffat: What confidence does my hon. Friend have that the figures given by the Colombian Government on the deaths of trade unionists are accurate, given that Amnesty International reports that many more deaths have occurred? Imagine the atrocity of people losing their lives just because they are trade union members.

Kim Howells: The murder of trade unionists and human rights workers in Colombia is an issue of great concern. I have seen various figures and the picture is far from clear, but the bottom line is that a single murder of a trade unionist or a human rights defender is one too many. My hon. Friend will know that, whichever figures one takes, the number of such killings was falling year on year until this year. I am sure that she will share our great concern that the trend has been reversed and, as I did in April, I call on the Colombian Government to do everything that they can to ensure that those in Colombia who fight to defend human rights are able to do their work in safety and without fear.

Edward Davey: What is the Foreign Secretary doing to end the scandalous situation in which a British bank—Barclays—still bankrolls Mugabe's thugs by operating through a local subsidiary, thereby bypassing EU sanctions on Zimbabwe? Why has action not yet been taken to deal with that insidious loophole at either the UK or the EU level? Will he condemn that practice which flouts the spirit if not the letter of the sanctions against Zanu-PF's leaders?

David Miliband: I condemn anything that gives financial or moral succour to Zanu-PF leaders. As far as I am aware—and I am happy to take new information if the hon. Gentleman has it, and follow it up—we know of no British company that is breaking the sanctions regime.
	In respect of companies that are using subsidiaries or other means, I would want to look at the details of any individual case. The details are important, because there is the question of employment and support for ordinary Zimbabweans as well as succour for the regime. However, we utterly condemn anything that gives support to the regime.

Andrew Love: My hon. Friends will be aware of the ceasefire in Burundi between the FNL and the Government. Hopes are high that that will lead to peace talks and a settlement, but we have been here before. Critical to any success will be the reintegration of the FNL combatants into Burundi society. What efforts are Ministers making to assist in the peace process and, perhaps more importantly, to help Burundi reintegrate people into society after the civil war?

Meg Munn: We too are optimistic about the peace process and the UK Government will continue to support the Government and people of Burundi in terms of that process. We are expecting about 150,000 refugees to return to Burundi this year, and my hon. Friend will know that that means that the rate of return has increased considerably. The UK provided £1.1 million in October 2007 for cash grants for those returning refugees.

Stephen Crabb: If the catastrophe and suffering in Burma are not sufficient, and the bloodshed, violence and economic destruction taking place in Zimbabwe are not sufficient, can the Minister please tell us what set of circumstances would warrant intervention under the doctrine of responsibility to protect?

David Miliband: We did not manage to get to this question in the first 45 minutes, and the hon. Gentleman is absolutely right to raise it. As he knows from the debates we had about Burma, we are ready to use the full force of international law. Of course, the responsibility to protect has legal aspects as well as political aspects—those legal aspects include proof of crimes against humanity, war crimes or ethnic cleansing.
	Because Zimbabwe is not a signatory to the International Criminal Court, the hon. Gentleman will know that a UN Security Council resolution is required for any referral. He will know from yesterday's statement that we have been working very hard to get Zimbabwe on to the Security Council agenda and that that has not been possible until now—never mind getting a Security Council resolution with a reference to the ICC. However, the UN's call for humanitarian envoys to be sent to Zimbabwe to assess the situation is the first step towards not only exposing the regime but making possible any referral such as that to which he refers.

Ann McKechin: Given the adoption of the new constitution in Kosovo, will my right hon. Friend comment on the progress of the withdrawal of the UN forces and the deployment of the new EU mission?

David Miliband: My hon. Friend makes an important point. The untold tale of the past three months is the lack of violence in Kosovo. The fact that 120 days have gone by since the declaration of independence—15 June marked that date—is very significant. This week, the Secretary-General of the UN will be taking forward the commitments in his report on the reconfiguration of the UN force into an EU presence right across Kosovo, respecting the need to ensure that there are no parallel security structures or alternative state structures in Kosovo. That is a major issue for the completion of the process of reconstruction in the former Yugoslavia and the western Balkans. It is a major achievement for European security and defence policy because the stability that now exists, although it is fragile in all sorts of ways, represents the best hope for Kosovo and its newly independent authority and Government.

Patrick Cormack: Will the Foreign Secretary give the House an undertaking that Zimbabwe will remain at the top of the Government's agenda until Mugabe has been removed from office and that there will be no question of giving help, aid or succour of any sort to other African leaders who make any attempt to sustain him in office?

David Miliband: Yes, certainly. I am sure that the hon. Gentleman will agree that Zimbabwe should remain at the top of our agenda beyond the date of the end of the Mugabe regime. Both sides of the House recognised yesterday that the massive reconstruction job is one in which we are not monopoly players—we are not the sole players—but I hope that we will be significant players in supporting a decent Government for those decent people in Zimbabwe who desperately need the help of not only Britain but all the richer countries, and certainly all their neighbours.

Hilary Armstrong: My right hon. Friend will be aware, as I am, of the worrying speculation about an impending famine in Ethiopia and its consequences. We have all seen this before. How are the Government and other players preparing to ensure that we do what we can either to avoid the famine or to deal with the lack of food so that the people of Ethiopia do not suffer?

Kim Howells: I visited Addis Ababa last week and tried to discover what I could about the preparations that have been made to meet that impending catastrophe. As far as I could judge, it certainly does not look as though it will be on the scale of 1984. I was told that there are adequate food supplies and that the systems are in place to get that food to the people. I hope that that is right. The Secretary of State for International Development has been keeping a close eye on the matter and our aid agencies in Ethiopia are working very hard to ensure that those systems are used to the full and that starvation does not occur.

Geoffrey Cox: The Foreign Secretary will be aware of the tragic and disturbing case of my constituent, Scarlett Keeling, who was brutally murdered and raped on a beach in Goa. What steps has the Secretary of State taken to review the advice to visitors to Goa? Will he meet her mother, my constituent Fiona MacKeown, who is extremely anxious to meet him?

Meg Munn: All our travel advice is reviewed regularly, to take account of changes in the diplomatic situation and of examples such as the tragic case that the hon. and learned Gentleman has cited. I am sure that the whole House will want to send our condolences to Scarlett's mother. Ministers will of course meet any family who have experienced such a tragedy, and I am sure that my noble Friend Lord Malloch-Brown will be happy to meet Ms MacKeown.

Jim Sheridan: Ministers may be aware of an organisation called the Westminster Foundation for Democracy, which is funded out of taxpayer's money by the Foreign and Commonwealth Office. What is the organisation's purpose, how is the money spent, and what parliamentary accountability does it have?

Meg Munn: The Westminster Foundation for Democracy facilitates links between political parties around the world to help build democratic skills. We all know that training people and strengthening Parliaments and political parties at national and local level are very important to ensuring transparency and effectiveness. The FCO provides grant aid for the foundation, whose board includes six independent governors and eight governors from the Westminster political parties.

Protection of Bats and Newts

Andrew Robathan: I beg to move,
	That leave be given to bring in a Bill to permit the disturbance of bats and newts for specified purposes; and for connected purposes.
	I should at the outset declare an interest, as I have been a member of the World Wildlife Fund, now called the World Wide Fund For Nature, longer than I have been a member of the Conservative party.

Desmond Swayne: Shocking!

Andrew Robathan: It is not shocking at all.
	I am very fond of bats and newts and it still thrills me when I see them. As a child, I used to catch newts when doing what is now known as "pond dipping". Like Ken Livingstone, I like newts and, on that basis, I would name this Bill the "Livingstone Mayoralty Memorial Newt Bill".
	Although there may be some amusement here, this is a very serious issue. What links great crested newts and bats is that they are both European protected species—EPS—and that gives strict protection under the European habitats directive.
	I shall illustrate but two of many recent cases that explain the problem. First, last summer Mr. and Mrs. Histed, who live near Chippenham in Wiltshire, were flooded out of their house by 3 ft of water when a ditch blocked. Repairs to the house cost a quarter of a million pounds and, not unreasonably, they wished to unblock the ditch. However, they were refused permission by the Environment Agency, which ordered a "newt search", forcing this pensioner couple to remain in a caravan.
	Secondly, on the edge of my constituency, the Earl Shilton bypass was delayed three months after it was believed that great crested newts might be on site. The council spent £1.2 million erecting special newt fencing and traps, but it never found a single great crested newt.
	That is hardly surprising, as anyone who knows anything about the life cycle of great crested newts will know that they can move 1,000 yd or more from their breeding sites. One might think that this newt must therefore be rare but, according to the Government, there are 66,000 great crested newt breeding ponds in England alone, and the Secretary of State for the Environment said in a letter to me that
	"great crested newts are widespread in lowland England and in some areas are present in good numbers".
	Furthermore, the decline in these newts results from changed farming practices, which have caused ponds on farmland to be filled in. May I suggest that creating new ponds would be cheaper and more effective than expecting the Leicestershire council tax payer to fork out £1.2 million for nothing?
	Bats—which are so beautiful flying at dusk—are also an EPS under the habitats directive. They are wild creatures whose natural habitat is roosting in caves or rotten trees. They existed long before man built houses and churches. Bats in the belfry may be a longstanding joke—of sorts!—but it is no joke in many churches.
	I should like to draw particular attention to St Nicholas church in the hamlet of Stanford on Avon, 100 yd outside my constituency in the constituency of my hon. Friend the Member for Daventry (Mr. Boswell). The 14th century church is filled with the most marvellous monuments in alabaster and marble. There is an organ case from the chapel royal in Whitehall palace that was sold after the execution of King Charles I. Simon Jenkins gives the church four stars in his book, "England's Thousand Best Churches", but if the mediaeval stained glass had been in situ rather than being restored, he might easily have given it five stars. The church is part of our national heritage, and deserves to be preserved. I was there on Sunday, sitting next to a 16th-century tomb of a knight and his wife. The tomb was restored at great cost, which was partly met by taxpayers through English Heritage and the National Heritage Memorial Fund. Bat droppings are stuck all over the intricate tracery and writing on the tomb and can also be found all over the walls and often on the altar. That is very unpleasant and is a hygiene risk during communion.
	Much worse is the damage being caused to another fine marble monument, which has been under a bat roost. The urine, which contains ammonia, has stained and scarred the marble and the monument itself is sometimes completely covered in piles of droppings; I am talking about not one or two, but bucketloads of droppings. I have a photograph that I am happy to show any concerned Member.
	The church's tiny congregation is unable to take any action because of the habitats directive. Natural England has not been helpful. It has suggested ludicrous gazebos over the monuments; I wonder how that approach would work with wall paintings similarly at risk in other churches. Helpfully, Natural England charged the church warden £525 for its useless advice. The taxpayer funds the restoration of churches through one Government body, but another Government body insists that they cannot be preserved from damage by bats. Even worse is the fact that the diocesan advisory committee for Coventry and Leicester wrote that the parochial church council
	"should seriously consider declaring the church redundant"
	because of the infestation. I shall be writing to the bishop.
	Bats, of course, will live elsewhere. According to the Bat Conservation Trust,
	"The Pipistrelle bat has probably declined as a result of modern agricultural practices"—
	no mention is made of boring sermons in church. One can assist bats by putting up bat boxes and by leaving rotten trees to stand, and we should do such things.
	My problem with both the EPS issues that I have mentioned is that the entire approach is disproportionate. The Department for Environment, Food and Rural Affairs tells me that it advocates a proportionate response regarding great crested newts, but I note that last year Taylor Woodrow was fined £2,000 for damaging a newt site in Essex.
	If anybody doubts the ridiculous bureaucracy surrounding this issue, they should look at the way in which Natural England thinks one should deal with great crested newts. It recommends completing a "method statement" on an Excel-format spreadsheet template. There is not much common sense in that.
	Furthermore, the Government's Countryside and Rights of Way Act 2000 has made disturbing or handling the animals arrestable offences—someone could get a six-month jail sentence for pond dipping. Why is there not a proportionate response? The House might know that there was a derogation under the original legislation in 1994. Members might wonder what the European Court of Justice does, and now I can tell them: it judges these matters, and it overturned the proportionate approach and the derogation. It transpires, I regret to say, that this ridiculous situation is all down to the wicked European Union.  [Interruption.] It is true.
	Mankind can and should be able to live in harmony with the animal kingdom, including bats and newts. We should have a balanced approach so that, without harming newts or bats, people can get on with their lives. Our natural heritage, which I wish to see enhanced, can co-exist happily with our national heritage in churches in Norfolk, Stanford on Avon and elsewhere. It is ridiculous that some very intelligent, highly paid civil servant in Brussels, or indeed in Whitehall, should be laying down such detailed and foolish laws. In this case, the law really is an ass.

Christopher Fraser: It's batty!

Andrew Robathan: Indeed.
	My Bill would ensure that Ministers insisted on the reform of the European habitats directive and set up a more pragmatic, balanced approach, conserving our natural heritage of great crested newts and bats without the adverse consequences that I have illustrated.
	Hon. Members may know act IV, scene i of "Macbeth":
	"Fillet of a fenny snake
	In the cauldron boil and bake;
	Eye of newt, and toe of frog,
	Wool of bat, and tongue of dog".
	The issue is not about putting bats and newts in cauldrons, but there is toil and trouble. Let us have some common sense instead.
	 Question put and agreed to.
	Bill ordered to be brought in by Mr. Andrew Robathan, Sir Patrick Cormack, Christopher Fraser, Mr. Tim Boswell and Robert Key.

Protection of Bats and Newts

Mr. Andrew Robathan accordingly presented a Bill to permit the disturbance of bats and newts for specified purposes; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 17 October, and to be printed [Bill 125].

Opposition Day
	 — 
	[15th Allotted Day]

Cost of Living

Mr. Speaker: I inform the House that in both debates I have selected the amendments in the name of the Prime Minister.

Philip Hammond: I beg to move,
	That this House expresses its deep concern at the rapidly rising cost of living; recognises the pressures this places on wage-earners and pensioners, especially those on the lowest incomes; acknowledges the danger to the UK economy of entrenching inflation through excessive wage claims in response to rising prices while understanding the concern of people who find their living standards squeezed; and therefore regrets the inability of the Government to provide assistance and support to hard-pressed families because of what the OECD describes as 'excessively loose fiscal policy' pursued by this Government over the years of economic growth.
	The cost of living is back at the top of the political agenda and on the front pages of all our newspapers. When I first became aware of political debate in my early teens, the economy dominated the agenda and the battle to control inflation dominated the economic policy debate. It influenced almost every aspect of that debate; it toppled Governments and shaped our national institutions. Indeed, for many of us, it shaped our perceptions for half a lifetime. Then, after the Conservative Government introduced inflation targeting in 1992 and the incoming Labour Government reinforced that move in 1997 by creating the independent Monetary Policy Committee of the Bank of England, it ceased, for a decade or more, to be an issue on the political radar screen.
	How tempting it was, therefore, to believe the rhetoric of the then Chancellor, our Prime Minister, that the dragon of inflation had really been slain—that the sunlit uplands of endless economic growth, low interest rates and appreciating asset values had been reached without the unwelcome spectre of inflation spoiling the view. Indeed, the Prime Minister built his entire reputation on the claim to have been the man who delivered economic stability—who ended boom and bust. Well, not any more.

Andrew Love: Will the hon. Gentleman accept that the former Chancellor built his reputation on the independence of the Bank of England, which the hon. Gentleman's party did not support at the time, and that that has been a major weapon against inflation?

Philip Hammond: If the hon. Gentleman had been listening, he would have heard me say a few moments ago that inflation targeting was introduced by a Conservative Government and reinforced by independence of the Bank of England, which we, in turn, are now committed to reinforcing still further in a way that this Government have resisted.

John Redwood: Does my hon. Friend remember that, far from creating an independent Bank of England, the Chancellor gutted and filleted it, taking away debt management and nationalising it into the Treasury, and taking away day-to-day banking supervision, so that the Bank was blind and deaf in the money markets when the credit crunch hit? Is not that a major problem?

Philip Hammond: My right hon. Friend is absolutely right. As he will know, we have been arguing for some time that the responsibility for rescuing a failed bank under the proposed new system must lie with the Bank of England, not the regulator. We are delighted that the Chancellor appears at last to have come round to accepting the logic of that position.
	The former Chancellor's reputation is unravelling before his eyes. The man who rode the Asian tiger of imported deflation bleats that what is happening in Britain today is all someone else's fault—from the credit crunch, to the fuel price at the pumps, to the soaring cost of food and spiralling home heating bills. He was the lucky Chancellor whose good fortune was to preside over the greater part of what the Governor of the Bank of England has called the NICE—non-inflationary, consistently expansionary—years, and whose misfortune is now to have his legacy exposed as a sham, because when the wind blew the economic house that Gordon built turned out to be made of straw.

Angus MacNeil: The hon. Gentleman calls the former Chancellor the lucky Chancellor, but when we set his record beside those of Charlie McCreevy and Brian Cowen as Finance Ministers of the Republic of Ireland, we see that the growth that he achieved was only half what they achieved. He was not that lucky or that golden—in fact, I would contend that he was a bit rusty.

Philip Hammond: The hon. Gentleman makes a point. By "lucky Chancellor" I simply mean that he was riding the crest of a wave of imported deflation, which created many of the conditions upon which he built his claimed reputation. The hon. Gentleman is absolutely right to point out that UK economic growth, like UK productivity growth, has been poor over the past decade compared with many of our competitors.
	The economy is firmly back on the agenda. Inflation is booming on the high street and the Prime Minister's reputation for economic competence is bust. The cost of a shopping basket of groceries has rocketed by 12.6 per cent. according to  The Grocer—that well-known authority on grocery prices—while fuel and domestic energy prices are up 17 per cent. and 9 per cent. respectively, with a further increase of at least 40 per cent., or around £400, for an average household predicted in domestic gas prices for the coming winter. Worse than that, the cost of a basket of 40 essentials has increased by 19.8 per cent. over the last year, piling the pressure on the most vulnerable consumers—those on low and fixed incomes. Bread is up 29 per cent., eggs are up 48 per cent, butter is up 30 per cent. and transport costs are up 16 per cent. The  Daily Mirror's cost of living index shows most people faced a rise of 11.6 per cent. over the last year, not the official 3.3 per cent. I think that even the Government are likely to agree that that is unlikely to be a Conservative plot.
	A family that spent £100 a week on food or drink a year ago has to find an extra £1,000 this year for the same items. There are some positive consequences. Apparently, more people are growing their own vegetables—one in three of us according to a survey in  The Daily Telegraph, with nearly half motivated by cost. But there are some not so positive consequences. Bargain hunters are moving away from fresh foods and resorting to cheaper options. Frozen fish sales are up 11 per cent. on a year ago. A survey of citizens advice bureaux in England and Wales suggests that a growing number of people are having difficulty in paying for, and are seeking help with, essential household bills.

John Barrett: Does the hon. Gentleman agree that among the most vulnerable groups—those who are hit hardest—are disabled people, who have higher energy costs and often higher food costs as well? Inequality among the most vulnerable has widened.

Philip Hammond: The hon. Gentleman is absolutely right and I shall say something about that in a moment.
	Ctizens advice bureaux reported a sharp increase in the number of mortgage arrears problems, which were up 35 per cent. in the first two months of 2008, compared with the same period in 2007. They also report a continuing increase in problems relating to basic essentials, such as gas, electricity, water, telephone and council tax debts. The CAB's briefing reports that the combination of big increases in household bills, especially fuel, and rising housing costs is putting additional pressure on people's finances when they are already stretched to the limit. Bureaux reported that they had dealt with 215,000 new debt problems in the first two months of 2008 alone and the report goes on to list examples that all have one thing in common: people on low or fixed incomes who are living at the margin of economic viability. For many people, the surge in living costs is turning a situation that is just manageable into one that is not.
	We have tabled this motion to give the House an opportunity to debate the soaring cost of living and the Government's lack of room for manoeuvre in responding to it. The first part of the motion expresses the House's deep concern at the rapidly rising cost of living. To be candid, there are two reasons for that concern. The first, as the CAB report demonstrates, is a compassionate concern because inflation hits hardest those with the least bargaining power: pensioners on fixed incomes, the lowest paid in the most marginal jobs and people with long-term disabilities who are living on benefits. When an economic shock strikes, those groups, by definition, will be the least able to cope with it and the least likely to have any savings cushion. All of us in Parliament must voice their concerns and fears because they have little bargaining power themselves.
	There is, however, a more calculating economic reason for the rising cost of living. Rapidly rising inflation also affects those with more bargaining power in the employment marketplace. Their response to the rapidly rising cost of living poses the genuine threat to our future economic stability, hence the second part of the motion, which acknowledges the dangers of a wage-price spiral.
	As the economy slows and earnings stagnate while prices rise inexorably, the average family is already £400 a year worse off than it was a year ago. The current official retail prices index inflation is 4.3 per cent. a year, but the expectation of future inflation is as important as the level today in determining the behavioural responses to it. Every hon. Member knows from discussions with constituents that people's perception of price increases and their expectations of future inflation are far higher than the official data suggest—unsurprisingly, in view of the figures that I have cited.
	Mounting evidence shows that rising prices are feeding into higher wage demands and settlements. Pay rises in the energy, water, chemicals and engineering sectors in the quarter to April were at or above current inflation. The recent Shell tanker drivers' settlement has subsequently added a further turn of the ratchet. The Incomes Data Services data, which were published this morning, show how many private sector settlements now include RPI linking, reigniting memories of the disastrous flirtation with indexation in the 1970s.
	Yesterday's announcement of a vote for industrial action by local authority workers rejecting a 2.45 per cent. pay offer underlines the scale of the challenge that the Chancellor will face as he repeats his exhortation for pay rises to be kept in line with the Government's 2 per cent. inflation target, even as inflation looks set to reach double that figure. The prospect of a summer of discontent looms and Conservative Members wait with interest to see how a Labour Government, desperate for cash from the unions to save the Labour party from bankruptcy, will deal with the new militancy on wages on top of the already aggressive demands for further competitiveness-eroding employment legislation.
	Last week, the Governor of the Bank of England gave a frank appraisal of the threat to Britain's economy from the rising cost of living. With consumer prices index inflation up from 1.8 per cent. to 3.3 per cent. in the past nine months and a raft of further price increases to feed through, the Governor warned of the dangers of a wage response, which would mean that the jump in food and oil prices was embedded in our economy through an old-fashioned wage-price spiral, with wage earners trying to compensate themselves for rising prices, thus ensuring the further erosion of the value of their wages.
	Let me take the opportunity to say from the Dispatch Box that the Governor of the Bank of England is right. Given that growth is slowing significantly below the Treasury's Budget estimate, if the inflationary pressure that has surged through into the index in the past months is reflected in future wage rises, Britain risks revisiting the 1970s, with entrenched inflation and stagnant growth—stagflation in all its horror. By warning of his determination to stick to the Chancellor's inflation target, the Governor is effectively throwing down the gauntlet to the unions, with the clear threat, "Go for the inflation-matching wage rises and I will bust you with growth-killing and unemployment-creating interest rate increases." They should listen to the Governor of the Bank of England.
	We will support the Government when they do the right thing on pay restraint, as my right hon. Friend the Leader of the Opposition said yesterday. However, after two years of stagnant real wage increases, let us be clear about what the Chancellor is demanding. As with taxes, so with wage policy—let us have an end to stealth and a new openness; an explanation of policies, tough or tender, up front and without spin. I put it to the Chief Secretary that the Chancellor is demanding a cut in living standards—is not that the essence of a demand for below inflation wage settlements? Is not the legacy of the Prime Minister's 10 years in the Treasury falling living standards for British workers? Yes, inflation has to be controlled, so that Britain can maintain its competitiveness and be in a position to respond when the upturn comes. That means difficult times ahead. The truth is that the Government are in no position to help out and soften the blow of this painful adjustment to economic reality.

Rob Marris: Obviously our country faces great challenges, and the hon. Gentleman is right: people are hurting. He talks about openness of policy, so could he tell the House the extent to which he thinks any Government can alleviate the sorts of difficulties that our country faces, and what his party's policies are to address them? The Conservative party motion puts forward no policies, whereas the Government amendment sets out four of the steps that the Government have taken to try to address the issues. If we are to have open debate and openness about policies, for which the hon. Gentleman calls, could he tell us his party's policies?

Philip Hammond: The hon. Gentleman asks what the solutions to the problems that we face are. He is right in one sense: there are no easy or quick solutions and no magic wands. The essence of our argument against the Government is that we have entered this downturn—and it is a downturn—uniquely ill prepared to deal with it. The Prime Minister did not fix the roof while the sun was shining, and the British people will pay the price for the lack of preparedness of the British economy.

Michael Jabez Foster: What the hon. Gentleman says is exactly what he and his hon. Friends keep saying. What particular cuts would have been made by a Conservative Government in the past 10 years? What expenditure would not have been incurred, to make the savings that would have achieved his objective?  [ Interruption. ]

Philip Hammond: My hon. Friends behind me are throwing out a few suggestions: the refurbishment of the Ministry of Defence headquarters, identity cards and money wasted on computer systems that never work. If the hon. Gentleman thinks back, he will remember that my party's manifesto at the last election set out some clear proposals for cutting costs and waste in government. However, we want to look to the future and talk about the policies that we need to adopt to prevent a repetition of this situation, so that we never return to this position again, by setting out a long-term policy to share the proceeds of economic growth, so that in future we do not borrow through a boom and leave ourselves unable to respond to the kind of situation that the Government now face.

Graham Stuart: The incoming new Labour Government promised my constituents, particularly the low-paid and those living in isolated rural areas, that they would be wise spenders, not big spenders. Those people feel absolutely let down by a Government who were supposed to be there to look after the least well-off, when it is the least well-off who are paying the highest price for that Government's failure.

Philip Hammond: My hon. Friend expresses eloquently the concerns of his constituents and those of many other of my hon. Friends' constituents.

Daniel Kawczynski: Does my hon. Friend also share my concern about the sheer levels of national debt that the socialists have incurred over the past 10 years? We now owe more than £700 billion, which has obviously put them in a straitjacket, which means that they cannot inject liquidity into the economy when we face a recession.

Philip Hammond: My hon. Friend is right. I will return to that issue in a moment, because that is the essential point. Although we agree with the Government about the need to avoid a wage/price spiral and the need for wage restraint, they have put themselves into a position in which they simply do not have the tools available to respond to the pressure that families and businesses are feeling.

Don Touhig: Will the hon. Gentleman give way?

Philip Hammond: I will in a moment, but I want to make a little progress.
	The Government have no room for manoeuvre, because they did not act prudently during what the Governor of the Bank of England called the NICE years. Fiscal policy is now alarmingly loose and monetary policy very tight in response—the classic hallmarks of a basket-case economy. Yet the Government still seem to be displaying just the tiniest bit of self-satisfied complacency. In their amendment to the motion, the Prime Minister invites the House to note that
	"unemployment, inflation and interest rates"
	are
	"all at historically low levels".
	But what matters to people now is that interest rates are the highest in the G7, unemployment is rising and the inflation rate is double what the Government inherited 11 years ago. Their amendment boasts about the measures that they are taking to support families and business, including increased tax allowances and winter fuel payments, yet those are the very measures that the Chancellor was forced to concede to buy off the rebellion on his own Back Benches over the 10p tax rate.
	Interestingly, the amendment describes the extra winter fuel payments and increased tax allowances as measures that the Government
	"will continue to take to support families and individuals".
	At first they said that they could not reopen the Budget, but then they did. Then they said they had no money, but when the political chips were down, they found some. Then they told us they would not announce until the pre-Budget report whether the additional winter fuel payments and increased tax allowances would be ongoing. Now they have done so, in this amendment. When the Chief Secretary to the Treasury responds to the debate, will she confirm that this is a policy announcement, and that the extra winter fuel payments and increased tax allowances are measures that the Government will continue to take to support families and individuals? And if that is the case, will she tell us what the cost will be for next year and the year after?

Jeremy Browne: I keep hearing from the Conservatives the mantra that the Government should have fixed the roof when the sun was shining. Will the hon. Gentleman comment on this quote from Michael Portillo, the then shadow Chancellor, in 2000, when the budget surplus was at its height and the sun was shining most strongly? This is what he said:
	"Conservatives will tax less, spend better and deliver more...We will cut taxes on business, so that they can compete and create prosperity and jobs. We will reform Labour's taxes on entrepreneurs...We will encourage savings...We will help pensioners and hard-working families. We will restore a married couple's allowance. We will cut the duty on fuel. That gives you a flavour of my budgets!"
	He did not sound as though he intended to put a lot of money aside for the lean years.

Philip Hammond: The gentleman in question went on to try his luck, lose and depart from these Benches. The Conservative party, too, has moved on in the past few years. We are always happy when Labour or Liberal Democrat Members offer quotes that merely serve to emphasise the extent to which my right hon. Friend the Member for Witney (Mr. Cameron) has changed the direction of the Conservative party.

Jeremy Browne: Will the hon. Gentleman give way?

Philip Hammond: No, I want to make some progress.
	Where did it all go wrong? The Prime Minister must ask himself that question every morning when he wakes up. It went wrong because he swallowed his own line on boom and bust. He started behaving as though the good times—the NICE years—were here for ever, and there were no rainy days to prepare for, and no roof to fix while the sun was shining. He borrowed through a boom, apparently oblivious to the need to prepare for the possibility that it would not be perpetual. Now he can stick "inappropriate pro-cyclical fiscal policy" on his mantelpiece next to "post-neoclassical endogenous growth theory"— [ Interruption. ] I think I said it okay, didn't I? For seven consecutive years he predicted that the deficit would turn into surplus three years out, and for seven consecutive years that target was rolled forward. He offered jam tomorrow, like putting a carrot in front of the donkey. While competitors and trading partners such as Australia, Sweden, the Czech Republic, Denmark and South Korea used the worldwide boom in trade and economic growth to pay off their public debt—making them well placed to weather the slowdown—he rolled out more, right the way through the good years.
	So, as a third of OECD countries face the economic slowdown with their budgets in surplus, Britain, with over 3 per cent. of GDP, has the largest public sector net borrowing requirement of any country in the world bar Hungary, Egypt or Pakistan, making Italy look like a paragon of fiscal virtue.

Jim Cunningham: We all recognise that we have economic difficulties, but I noticed that when the hon. Gentleman responded to my hon. Friend the Member for Wolverhampton, South-West (Rob Marris) who asked about alternatives, he started to talk very vaguely about ID cards and that sort of thing, and in response to the hon. Member for Taunton (Mr. Browne) he mentioned the manifesto. All that he talked specifically about was cutting waste—an argument that is always used. May I remind the hon. Gentleman that in 1997 we inherited a situation in which 50p in every pound went to pay off debt? The hon. Gentleman did not touch on those things. The Conservatives borrowed their way through the '80s and the '90s, so what is their solution to the problem now, as it is worldwide?

Philip Hammond: I am not really sure that I understand the point of that intervention, but I would say this to the hon. Gentleman. We have set out a very clear policy of sharing the proceeds of economic growth and we want it to go forward. It is a rule that will prevent us from getting into the same kind of trouble that the Prime Minister has got this Government into. I shall explain in a few moments, if I may, what I think has gone wrong.
	The Prime Minister swallowed his own line on boom and bust. He apparently believed that the good times would never end, and instead of putting something by for the more difficult times that were bound to come, he just went on spending and borrowing right the way through the boom.

Dawn Butler: rose—

Philip Hammond: I want to make some progress.
	Britain, with 3 per cent. of GDP as a net borrowing requirement, is going into an economic slow-down in a very serious fiscal position. In 1989-90, the Budget was in surplus as we moved into a period of economic slow-down. Where the Government have led, the consumer has followed, piling up a mountain of debt on the back of asset price inflation, with 175 per cent. of personal disposable income in household borrowing—the highest ratio in the world. The Government cannot help households because they have over-borrowed, and households cannot help themselves as the squeeze tightens because they have over-borrowed as well.

Nigel Griffiths: Will the hon. Gentleman give way?

Philip Hammond: Let me make my point, and then I will.
	As well as being unable to help people, the Government are actively reinforcing the inflationary pressures and thus the risk of a wage response. Consumer prices index inflation at constant tax rates is 3.1 per cent., which means that if taxes remained at the rates prevailing at the beginning of this year, inflation would be 0.2 per cent. lower than it is today.
	The issue of diesel prices has moved up the political agenda. That is hardly surprising, because the figures show that before tax the UK has lowest diesel prices in the EU, but after tax is added they are the highest. With inflation expectations so important, the Government must look again, as they surely will be forced to do by their own Back Benchers, at the swingeing road tax increases for next year and the year after, which are doubling the road tax for about a million older cars and raising it on the overwhelming majority.

Nigel Griffiths: What the hon. Gentleman is failing to point out to the House is that at the beginning of the 1997 cycle, Conservative debt was more than 41 per cent. of gross domestic product. Under Labour in this cycle, it is less than 37 per cent. The cost of servicing that Conservative debt was 9 per cent.; now it is less than 6 per cent.—a saving of around £23 billion to put into services each year. The hon. Gentleman may be shaking his head, but the truth is that debt levels under the Conservatives were astronomical compared with debt levels today, and he should admit that fact.

Philip Hammond: We have to remember that nowadays there is a huge concealment of Government debt off balance sheet, through the private finance initiative and other mechanisms. What I remember of 1997 is rising economic growth, falling unemployment, falling youth unemployment, falling inflation, and inflation half the level it is today. That is the legacy that I remember, which the hon. Gentleman's Prime Minister has squandered.

Brooks Newmark: To clarify the point that my hon. Friend is making, may I add that the figure is, I believe, not 40-odd per cent. of GDP but about 110 per cent., if we include all the debt that this Government have put off balance sheet?

Philip Hammond: My hon. Friend is right. If we strip out the Enron accounting we will get to some very different figures, which few Labour Members will want to quote back at us.

Jeremy Browne: Will the hon. Gentleman give way?

Philip Hammond: I want to finish, as many hon. Members would like to speak.
	There are other practical steps that the Government could take to help, such as promoting greater awareness of the best tariffs available from gas and electricity suppliers, adopting the proposal made by my right hon. Friend the Member for Witney (Mr. Cameron), the Leader of the Opposition, to include in gas and electricity bills information on average consumption levels of similar properties and a roll-out of smart metering to help people to manage their energy consumption better. However, the sad truth is that the Government have boxed themselves in. Excessively loose fiscal policy has left the UK, in the words of Alan Greenspan, "more exposed" than the US and facing difficulties that, in the words of the OECD, will be "larger than elsewhere".
	So here we are, with a Labour Prime Minister who for the last decade has been lecturing his neighbours on the continent on how to do it, now being slammed by the OECD for excessively loose fiscal policy, disciplined by the EU for the size of our deficit and, more importantly, unable to take action of the kind that more prudent Governments are taking to help their citizens and businesses when they most need it, not just because Governments are there to help their citizens, but because that is the best way to counter the pressure for inflationary wage increases.
	With the cost of living set to go on rising as growth stagnates, there are just two possible outcomes: either real living standards will fall in the immediate future or inflationary wage rises will defer the moment of pain, and in the process risk destroying Britain's competitiveness, and thus its prospects beyond the current downturn. The Government need to be frank with the electorate about the situation. Either way, the British public will know who to blame: a Prime Minister whose sole legitimacy was the claimed ability to manage the economy, but whose economic incompetence has left Britain and its citizens so ill prepared for the economic slow-down that we now face.

Yvette Cooper: I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:
	"notes the significant increases in world prices, with the oil price rising 80 per cent. and food prices up 60 per cent. in the year to May 2008; notes that the Governor of the Bank of England's letter to the Chancellor dated 16th June 2008 said that 1.1 per cent. of the 1.2 per cent. increase in inflation over recent months was due to world food and energy prices, and that the Government was right to tackle the rises with action on an international level, including urgently looking for a successful conclusion to the Doha round of negotiations in the World Trade Organisation and examining the impact of biofuels on food production; supports the Government's global leadership on these issues; recognises the pressure that these increases in world prices put on family budgets; further notes the measures that the Government will continue to take to support families and individuals, including pensioners and businesses, throughout the UK, including through extra tax credits, increased tax allowances, winter fuel payments and increases in child benefit; further notes that the most important support for working families is a strong and stable economy; and supports the Government's actions that have delivered unemployment, inflation and interest rates all at historically low levels, helping millions of families into stable home-ownership and sustainable employment."
	This is an important debate at a time when families across the country face pressure from rising world food and fuel prices. Those prices are going up across the world, not just here in Britain. Oil prices have nearly doubled in a year. Whereas a barrel of oil cost $10 a decade ago, a few weeks ago the price rose by that much in one day alone. That puts up the cost of petrol at the pump, as well as the cost of gas and electricity bills, which have themselves risen by 15 per cent. and more than 12 per cent. respectively in the last 12 months.

Angus MacNeil: The Minister mentions the rising price of oil in world markets, but my constituents face prices per litre for diesel and petrol that are 30p more expensive than in the Irish Republic. Will she accept her responsibility and that of her Government in relation to the pump prices that people face?

Yvette Cooper: Right across the country, there are pressures that people face—at the petrol pump, but also with their utility bills. There are also different parts of the country that show disparities in the prices that they face, which do not appear to be justified by ordinary economic factors. We are keen to look further into that. Discussions have taken place on the issue.

John Redwood: If people could still get petrol at £1.15 a litre, 70p of that would be Government taxes, which have been going up this year when the Government claim to be worried about the plight of the motorist. Why do they not simply get their tax down, because that is the dominant part of the price at the pump?

Yvette Cooper: As the right hon. Gentleman knows, we have delayed the fuel duty increase, and fuel duty has fallen in real terms over many years as a result of the decisions that we have taken. The issue that faces people at the petrol pump is not fuel duty, but the fact that we have seen such substantial increases in the price of oil, which is affecting countries right across the world.

Robert Key: The Chief Secretary is a reasonable person, and knows that hundreds of thousands of people across the country, in every part of the economy but notably in the national health service and social services departments, are subsidising their employers every time they fill up their cars with petrol that they use in the course of their work, because the approved mileage allowance payment scheme, set in 2002 at 40p a mile for the first 10,000 miles, has not been upgraded. Last year there was a review, which has not been published. I have tabled a parliamentary question asking the Department to publish that review, and have not been answered for three weeks. If she wants to take us into her confidence, could she not publish that report so that we can see why the Treasury has refused to take the simple step of upgrading such mileage allowances so that some of the poorest people in society no longer subsidise their employers?

Yvette Cooper: I am happy to look into the point about the review and to write to the hon. Gentleman about it. Again, however, the fundamental problem faced not just by this country but right across the world is the soaring price of a barrel of oil. Fuel duty is 16 per cent. lower in real terms than it was in 1999. Every country in the world is facing problems. Egypt, Haiti and the Philippines have had riots over food prices as a result of the pressure on commodity prices. In Spain and Italy, major protests have taken place about the cost of petrol. Countries right across the world are affected, and that is feeding into domestic inflation in this country too.

Stewart Jackson: On that point, is not the pertinent issue that other countries, particularly the United States, have in their armory fiscal policy to alleviate the credit squeeze? They are in a position to do that, but we are not, as a result of our Government's fiscal management.

Yvette Cooper: I want to come on to that point, because it is important. As a result of changes to tax credits, tax allowances and so on, we are putting money into the economy this year, and such support is right. The record of the hon. Gentleman's party on fiscal policy and debt management, however, was atrocious. Under this Government between 1997 and 2007 public sector borrowing was 1.2 per cent of GDP, whereas under the last Conservative Government between 1992 and 1997, public sector borrowing was considerably higher at 6 per cent. of GDP, and that is why debt was also considerably higher. He is therefore in no position to provide lessons on management of fiscal policy.

Daniel Kawczynski: Will the Chief Secretary give way?

Yvette Cooper: I will give way on one last point, and then make some progress.

Daniel Kawczynski: The Chief Secretary has referred repeatedly to the price of petrol and diesel. What plans does she have to help essential users such as road hauliers and those in the farming industry in the short term, to help them to overcome the petrol costs crisis?

Yvette Cooper: As the hon. Gentleman will know, such users can claim back VAT, and there is support in place to do that. We must recognise, however, that such price increases are having an impact across the economy, on businesses as well as on households. That is why it is important that sensible decisions are taken not just in this country but globally, to try to get through the problems that we face as rapidly as possible.
	The problem affects not just oil, but food. Global food prices have also risen by over 40 per cent. in the last year, with basics such as rice and wheat hitting new highs. The increased price of bread and eggs in the shops has an impact on families. The Governor of the Bank of England has said that the inflation increase that we have seen is accounted for by
	"large and until recently unanticipated increases in the prices of food, fuel, gas and electricity."
	Those components alone account for 1.1 percentage points of the 1.2 percentage points increase in the CPI inflation rate since last December.
	The price rises are having an effect across the world. Those on fixed incomes, and particularly pensioners, who are often on fixed incomes and might be on lower incomes than households across the board, face particular pressures when they look at their gas and electricity bills and worry about prices as winter approaches.

Mark Field: Will the Minister give way?

Yvette Cooper: I shall be happy to give way after I have made a little progress.
	The world economy faces rising prices, and at the same time we are having to deal with an ongoing global credit squeeze that is having an impact on mortgage lending. As a result the British economy faces tougher times ahead, and like other countries we will need to respond to that. However, we face these challenges in a much stronger position than our position in earlier decades. Overall inflation stands at 3.3 per cent.; the Governor of the Bank of England has said that he expects it to rise to 4 per cent. before falling again towards the target next year. Our inflation rate is still lower than the rates in the United States and the eurozone, and very different from the rate in the 1980s and 1990s.

Philip Hammond: The Minister says that we face these pressures in a stronger position than other countries, but Alan Greenspan says that the United Kingdom is more vulnerable than other major economies. I understand that Alan Greenspan is, or was, an adviser to the Prime Minister. Is he wrong?

Yvette Cooper: Last month's report from the International Monetary Fund stated:
	"For over a decade, the United Kingdom has sustained low inflation and rapid economic growth—an exceptional achievement...the fruit of strong policies and policy frameworks, which provide a strong foundation to weather global"
	challenges.
	Let us examine the position from which we start, compared with that of previous decades. While the CPI inflation rate is now 3.3 per cent., it was 8.5 per cent. in April 1991, and for nearly two years it was more than twice as high as it is now. The retail prices index inflation rate is now 4.3 per cent. It peaked at over 20 per cent. in 1980 and averaged 6.4 per cent. from 1979 to 1997, compared with an average of 2.8 per cent. since. We should now be supporting the pensioners who experienced the breaking of the link between pension and earnings, cuts in their pensions and persistent high-inflation problems throughout the Conservatives' time in office, rather than listening to lessons from the Conservatives, whose record on both inflation and the management of public finances is one of which they should be ashamed.

Mark Field: Does it not occur to the Minister that the hostile public sentiment being directed at the Government is partly due to the fact that, while everyone understands that big global problems are affecting the economy at the moment, during the good times for the Government over the past 10 years they never observed that they were being assisted by benign economic conditions throughout the world, but tried to take the credit for all that was going well?

Yvette Cooper: I certainly think it worth reflecting on some of what has happened over the last 10 or 11 years. There have been benefits from world commodity prices, largely thanks to developing countries. There have also been significant benefits as a result of our making the Bank of England independent—a decision which, as the hon. Gentleman will recall, was opposed by his party—and there have been changes to support more competitive and global markets across the board. During the same period we have dealt with global challenges: for example, the bursting of the dotcom bubble and the events of 9/11, which pushed other countries into recession. Over the past 11 years other countries have experienced recession, while the United Kingdom has continued to experience strong economic growth throughout. We have weathered global storms before, and have done so better than other countries.
	The particular challenges that we face at the moment—the dual challenges of increasing world prices and a global credit crunch—are also posing considerable challenges to every other country in the world, but over the last 11 years income per head of population has grown faster in this country than in any other G7 country. In 1997 we were bottom of the G7 prosperity league; now we are second to top. We begin this period with employment at a record high, rather than the record unemployment that we experienced in earlier decades.
	None of that should cause us to underestimate some of the challenges that we will face as a result of these global problems, and the need to respond to them. No national Government can act alone to stop a global slowdown, and no national Government can act alone to solve problems caused by rising world commodity prices. What we can do, however, is work with the rest of the world—with our global and European partners—and take action here at home to support the economy and the families who face difficult times.

Douglas Carswell: Pensioners in Clacton face a fall in their standard of living. Their incomes are by and large fixed, but the costs of energy and utility bills and council tax bills have shot up. Apart from offering pensioners free swimming, what does the Minister think can actually be done to try to help their situation?

Yvette Cooper: As the hon. Gentleman will be aware if he has talked to pensioners in his constituency, we have increased the pension credit, as a result of which some pensioners are £2,000 a year better off than they would have been in 1997. We have also introduced the winter fuel payment, which will be increased this year by £50 for the over-60s and by £100 for the over-80s, particularly because we know that pensioners will be facing winter fuel bill pressures as a result of rising oil prices. We have increased the pensioner tax allowance this year as well. We have, therefore, already done a lot to support pensioners.  [Interruption.] My party colleagues on the Back Benches are reminding me of other measures, such as concessionary fares, free bus passes and the Warm Front programme to help pensioners insulate their houses.  [Interruption.] Yes, TV licences, too, and free eye tests. This Government have introduced a whole series of measures that the Conservative party did not introduce in order to help support pensioners. We want to continue to support pensioners, because we recognise that pensioners on fixed incomes face the greatest pressures.

Angus MacNeil: rose—

Jim Cunningham: rose—

Yvette Cooper: I have given way to the hon. Member for Na h-Eileanan an Iar (Mr. MacNeil) once already, so I shall give way to my hon. Friend the Member for Coventry, South (Mr. Cunningham) instead.

Jim Cunningham: My right hon. Friend lists what we are doing for pensioners, and I am sure that the Government understand that there are both fuel and economic problems. Will she also mention what she is doing for women between the ages of 60 and 64, because that is important, too, and people are concerned about it?

Yvette Cooper: My hon. Friend is right. As well as the winter fuel payment increase, we have increased the tax allowance; my right hon. Friend the Chancellor announced that.
	It is also worth pointing out that the Conservative party's own research document on the cost of living was forced to admit that since 2001-02 pensioner couples are in real terms £30 a week better off and single women pensioners are £21 a week better off. Those are not our figures; they are the figures that the Conservative party produced on the impacts on pensioners.

Several hon. Members: rose —

Yvette Cooper: Members will appreciate that I have given way a lot, and I know that many Members want to speak, but I shall give way to my hon. Friend the Member for Hastings and Rye (Michael Jabez Foster).

Michael Jabez Foster: I am grateful to my right hon. Friend. May I remind her of the deal she has done with the energy companies? The poorest pensioners in my constituency are getting 15 per cent. reductions in their fuel bills as a result of the social tariffs she has brought about.

Yvette Cooper: My hon. Friend is right. After this year's Budget, we held discussions with the utility companies, and as a result of working with them they have agreed to treble the amount of investment they are putting into assistance for the most vulnerable households—those on the lowest incomes, and those at greatest risk in terms of fuel poverty—in order to help them with their fuel bills this year. That is hugely important, and it needs to be seen alongside work to reduce the demand for electricity and higher heating levels by improving insulation through the Warm Front programme and also the requirement on the energy companies to put more money into insulating people's homes.

Several hon. Members: rose —

Yvette Cooper: I must make a little progress before giving way again. I will take more interventions later, if I can.
	The fundamental problem is that the world is not producing enough food or energy to meet rising demand, particularly with the growing demand from developing countries as well. We need to act at international level to help increase production in the short term. That means working with international partners to remove some of the barriers preventing increased supply. On food prices, the UK will work with other countries to put forward proposals for increasing agricultural production at next month's G8 summit. We have already committed to doubling investment in agricultural research to help improve efficiency and production over the next five years. We are continuing to press for reform of the common agricultural policy, because it is unacceptable that the EU continues to apply high tariffs to many agricultural imports, particularly at a time of such high prices.
	On oil, we are pressing for the removal of barriers that are preventing an increase in supply. This weekend, the Prime Minister was in Saudi Arabia making the case for greater transparency in the provision of data on oil supply and demand.
	We are continuing to press for further energy market liberalisation in the EU, so that consumers and businesses do not lose out as a result of inefficient and expensive gas and electricity markets. Of course, in the medium term we need to do more to reduce our dependency on oil and gas both in Britain and across the world, for the sake not simply of the world economy but of the planet. That is why we will be setting out further proposals on renewable energy later this week.

Peter Atkinson: On the rising price of oil, a claim is being made in the US that some of this increase is due to speculation in the oil futures market, and the Fed lays considerable blame for this on the London oil futures market, which it claims is under-regulated and wants greater regulation of. Will the right hon. Lady comply with that?

Yvette Cooper: The Financial Services Authority has been looking at this issue, and there are different views on speculation. There is also an underlying view that there are long-term problems here, regardless of the impact of short-term speculation, which mean that we are overly dependent on oil and gas not simply as a nation, but across the world. We need to do more to address that and to improve energy efficiency, while also recognising some of the pressures in the market that prevent increasing responsiveness to price signals in the energy market but also in food production.

Rob Marris: Will my right hon. Friend give way?

Yvette Cooper: I will, but then I need finally to make progress.

Rob Marris: I am grateful to my right hon. Friend. She has read out a long list of what the Government are trying to do to assist in this difficult situation. Does she agree with me that the official Opposition are not fit for government, given that they cannot put forward any policies? They decry jam tomorrow when in fact, all that they are talking about is proceeds of growth, which is a "jam tomorrow" policy if ever I heard one. They are the ones who caused the roof to be leaking in the first place, which we fixed literally and metaphorically around the country. They say that we need to tighten fiscal policy, but they do not even say whether they will put taxes up or cut spending. With a rhetorical flourish, the hon. Member for Runnymede and Weybridge (Mr. Hammond) sets out his policy to address the huge problems associated with the cost of living—smart metering. That is their policy.

Yvette Cooper: My hon. Friend is right—there was a distinct absence of alternatives and proposals from the Conservative party that would actually help either the UK economy or the global economic situation.
	We will continue to support the Bank of England through the monetary policy framework, and we are urging a responsible and disciplined approach to pay on both the private and public sectors. From the boardroom down, people do need to recognise the importance of this, of avoiding a return to the destructive wage spirals that we saw in previous decades, and of the Bank of England's being able to respond within the monetary framework. That is why we have welcomed the three-year pay deals in a series of areas in the public sector.
	The hon. Member for Runnymede and Weybridge (Mr. Hammond) was keen to protest the Opposition's strong support for wage restraint, probably in some determination to correct the hon. Member for Tatton (Mr. Osborne), who told the BBC,
	"I'm not against opening negotiated pay deals",
	sending a much looser signal about their commitment to support for wage restraint at a difficult time. We are increasing borrowing to support the economy, and that is the right thing to do at this stage in the economic cycle. We have delayed the increase in fuel duty, and we have increased tax credits and allowances for pensioners and cut the basic rate of tax. In addition, the Chancellor has increased the tax allowance for this year not just for those affected by the 10p rate, but for all basic rate taxpayers, putting £120 into the pockets of some 22 million people. The overall tax burden, which is less than it was during most of the 1980s, is set to fall this year.
	The impact of all this is that families with children will see their tax bills fall, in many cases by several hundred pounds a year, giving them more support at a time when there are difficulties in terms of pressures on the cost of living.

Philip Hammond: I am listening carefully to what the right hon. Lady is saying. Will she answer the question that I put to her? Will she confirm that, in asking people to settle for wage increases lower than the rate of inflation, the Chancellor is asking them to take a cut in living standards?

Yvette Cooper: I should point out to the hon. Gentleman that his own party's research document has recognised that in real terms, since 2001-02—even in advance of some of the most recent changes that we have set out—families with children are better off than they were in 1997, or in 2001-02. They are seeing real improvements in their income and their support. For example, lone parents are £12 a week better off and couples with children where one parent works full time can be more than £700 a year better off. That is why we are also providing people with additional support through tax credits. I should point out to the hon. Gentleman that this extra support being provided through tax credits, and by increasing child benefit in the next year and the winter fuel payment this year, is funded by the increase in alcohol duty that Conservative Members have opposed. They are opposing our measures to provide additional support to families at a time when people are under pressure, particularly from their winter fuel bills.
	It is worth reflecting, as my hon. Friend the Member for Wolverhampton, South-West (Rob Marris) suggested, on what the Conservatives' remedy might be. They have said that they would not put up alcohol duty and would have lower borrowing—not that they can point to any kind of historical record to support their position. We must remember that this is a party that has never proposed lower borrowing. Instead, it has repeatedly proposed spending increases and tax cuts at the same time—that would push borrowing up. Over the past 12 months alone, the Conservatives have called for £10 billion of extra spending on unfunded tax cuts. At the previous election, just at the time they now say they would have cut borrowing, they were actually calling for billions of pounds in extra borrowing—the independent Institute for Fiscal Studies costed their tax and benefit plans alone at an extra £5 billion. In 2005, they were also planning billions of pounds of extra spending on top of that, on things such as the pupil passport and the patients passport for private care, not to mention defence, the right to buy, tuition fees and offshore processing centres for asylum seekers.
	At the 2001 election it was the same story: a £3 billion unfunded tax cut on savings, which would help those on the highest incomes, but billions of pounds more spending on asylum seekers' reception centres, defence and other areas. The Conservatives would not have cut borrowing; instead, they promised again and again to dig themselves a massive black hole for the public finances. So much for telling us to fix the roof; they promised to dig up the foundations.
	This Government did invest in fixing the roof. Not only did we mend the hospital roofs, the school roofs and the council house roofs that the Conservative party neglected and abandoned, but we invested in the infrastructure and skills that the British economy needs. We have been operating within our fiscal rules to bring down debt substantially and to cut the bills of the economic failure and high unemployment that we inherited from the Conservatives. That is why we have the flexibility to support the economy right now.
	Britain, like other countries, is facing a difficult time as a result of world economic problems. Families across Britain are facing the pinch. They are facing higher prices as a result of increasing world food and fuel prices, but these world economic problems need a serious response—with substance, not just showmanship, and with serious policies not just spin—to help households and businesses through the more difficult times. That is why the House should reject the posturing of the Conservative party and back the Government amendment.

Vincent Cable: The hon. Member for Runnymede and Weybridge (Mr. Hammond) gave a clear and forceful critique of Government economic policy, much of which I agreed with and so do not need to repeat. I am thinking in particular of the sense of hubris that derived from the claims about there being no more boom and bust and about the best economic performance since the Hanoverians, and the contrast with today's reality.
	There is one commodity that is not in scarce supply at the moment, and that is criticism of the Government, so I do not need to add to a glut in the market. I shall concentrate instead on scrutinising more closely what the Conservatives are offering as an alternative economic strategy and the terms of their motion. I think that there is a genuine interest, both positive and negative, in what an alternative Government might have to offer. Perhaps I could start by dealing with the phrasing of the motion, by which I am genuinely a bit confused. The first five lines seem eminently sensible and fair, but the motion then goes on to talk about "excessively loose fiscal policy" with approval. The correct policy response to excessively loose fiscal policy—this is presumably what the Conservatives think the Government should have done, and is what the Conservatives would have done and would now do—is to use a combination of higher taxes and reduced spending. That is the opposite to loose fiscal policy. But the motion does not say that. It says that what the Government should have done—what the Conservatives would presumably have done—is to provide assistance and support to hard-pressed families, which involves cutting taxes and increasing spending. Within the same sentence, we have two diametrically opposed macro-economic policies—

John Redwood: Was the hon. Gentleman asleep when the Conservatives produced endless proposals for getting better value for money and having fewer administrators, fewer targets, fewer quangos, fewer ID cards and all the other claptrap that has wasted billions?

Vincent Cable: I was not asleep: I was assiduously reading "The Cost of Living Under Labour" and I shall address the seven-point plan that the Conservatives propose to deal with the situation. It is possible plausibly, and perhaps wisely, to argue for fiscal austerity and for crowd-pleasing tax cuts and spending measures, but to advance them at the same time completely lacks credibility. I will proceed through the seven points, and I hope that my argument will begin to stack up.

Philip Hammond: I have great respect for the hon. Gentleman on these issues, but does he accept that "excessively loose" was not our description of the Government's fiscal policy—it was the OECD's description? Does he agree that if the Government had adopted a less excessively loose fiscal policy during what the Governor of the Bank of England called "the NICE years", they would be in a stronger position now to provide support and assistance to hard-pressed families and businesses and thus to draw the sting from the pressure for inflationary wage increases that they now face?

Vincent Cable: That does not follow at all. The hon. Gentleman said in his speech that the main emphasis of policy has to be on monetary policy and if interest rates have to fall—which I think is what he wants to happen to deal with the slow-down in the economy—fiscal policy would have to be tightened. There is a problem with fiscal policy, as the OECD identified, although it is less extreme than the hon. Gentleman claims. Were we to go into a period of slump, or of prolonged stagnation as they had in Japan, it would be very difficult for the Government to embark on strikingly Keynesian policies, because of the erosion in the fiscal rules that has already taken place. But that is not what the motion says. It gives the impression that we can simultaneously have fiscal austerity and crowd-pleasing measures of assistance and that is a fundamental contradiction.
	I shall go through the seven proposals. The first is to give 1.8 million couples an extra £2,000 a year, addressing the couple penalty in the tax credit system. That is a good policy, and I applaud it, but the concluding sentence makes it clear that the change
	"will be implemented as savings are generated through our radical programme of welfare reform."
	In other words, it may happen, but it would take time and it certainly would not provide much relief to hard-pressed families in the short term.
	The second proposal, which interested me particularly, was shifting the burden of taxation away from families. It talks about
	"our commitment to increase the proportion of taxation raised through green taxes by rebalancing taxation away from taxing 'good' things, like jobs and investment, towards taxing 'bad' things, like pollution and carbon emissions."
	When I read that, I felt like a member of the General Medical Council reading an essay by Dr Raj Persaud. I felt that I had read that somewhere before and, in fact, I wrote it. The Conservatives have lifted our green tax switch policy of several years ago.
	As a candid friend, I can tell the Conservatives in strict confidence that adopting Liberal Democrat policy in that respect would not be without problems. There are two ways in which that Conservative policy—I take it as a compliment that they have borrowed it from us—could be delivered. The first is to have a carbon tax, which in reality is a tax on household fuel, and even I am not brave enough to argue for that. The second is to increase taxation on transport fuels. A bit can be raised from aviation taxes, but the green tax switch, which is the third element in the Conservative proposals, in fact involves increasing taxation on the motorist.
	I do not know whether the editor of the  Daily Mail has been told yet that the Conservatives are campaigning to increase taxes on the motorist. I am not even sure that the shadow Chancellor has been told, because he told  The Daily Telegraph last week that he was committing himself to not increasing the 2p rate on duty on petrol in the autumn, which struck me as an extraordinarily silly and impetuous thing to do. It might be that the Government will not increase it, and that might perhaps be the right thing to do, depending on conditions at the time. We do not know what the Government's fiscal position will be in the autumn. We do not know what the oil price will be. Any sensible person would wait before making such a commitment.

Stewart Jackson: Being lectured by the Liberal Democrats on tax policy is rather like being lectured by a eunuch about an orgy. The only two discernable fiscal policies that the Liberal Democrats have had are the 50p top rate of tax, which was unpopular, and the local income tax, which is completely unworkable. Apart from that, the Liberals are doing well. Has the hon. Gentleman any other ideas on fiscal policy that he will be putting in his next manifesto?

Vincent Cable: I was actually talking about one of our policies, which the Conservatives are talking about introducing, and I was explaining how they could do it. I am not sure what the hon. Gentleman's problem is.
	As I say, the shadow Chancellor has committed himself to the 2p tax reduction—at least, he has made that commitment to the readers of  The Daily Telegraph blog, although it might not have gone any further yet. The implication, of course, is that the family fund that the Conservatives propose to establish to help cut taxes for families starts with a deficit of £1 billion a year. That is a problem.
	The third element of the programme involves cutting stamp duty for first-time buyers, but to do so at this stage of the housing cycle is not just economically foolish but positively unethical as that is trying to draw people into the housing market at a time when house prices are falling. Be that as it may, I agree that stamp duty needs to be reformed. In particular, it needs to be reformed not for people at the bottom end but for those who are paying more than £250,000 for a property, who pay the 3 per cent. slab. There is an argument for reforming stamp duty to shift the burden on to much higher value houses from those in that price range.
	The interesting thing about the proposal—perhaps the Conservative spokesman can clarify it—is that that policy depends on the assumption that the tax change will be paid for in full by the fixed levy on foreign non-doms. My understanding is that that levy is going through the Budget, but once the Budget has been completed, will that policy lapse or will there be a second levy on foreign non-doms? That is a legitimate question and I hope that at some point we might get an answer.
	There is another set of Conservative proposals to do with personal debt. I am very interested in the subject and have spoken a lot about it, and the Conservative suggestions are quite sensible if extremely modest. The one specific suggestion concerns illustrative scenarios for credit card users, and the only problem with the policy is that it is already happening. I believe that the Office of Fair Trading ruled three years ago that such illustrative scenarios for credit cards should be introduced. They have been introduced and they do not work because they are not comparable. The policy seems to have limited value, although it is perfectly sensible—

Philip Hammond: No doubt we are going to hear what the hon. Gentleman's policies are in due course.

Vincent Cable: The hon. Gentleman mentions our policies, but it is not our Opposition day. We had an Opposition day three months ago in which we set out some detailed proposals on the housing market and repossessions. I am happy to repeat what I said then, but this is not our Opposition day. The Conservatives have set themselves up and I hope that they would accept that it is reasonable to scrutinise what they have to say.
	Finally, I want to draw attention to the proposals on council tax, because they are fair. The Conservatives rightly point out that the doubling of council tax since the Government came in has been a major contributory factor to the pressures of the cost of living on low-income families and pensioners. It is a regressive tax that bears very little relation to current property values, and the Conservatives should know that because they introduced it. What I am puzzled about is why they have ignored some perfectly sensible reforms. We have argued that council tax should be abolished, but it does not have to be. The Lyons report contains some perfectly sensible reforms for increasing the take-up of council tax benefit, but they are not even mentioned by the Conservatives. Instead, they suggest that there should be a referendum to deal with excessive increases in council tax, and on page 18 of their document they list five councils that have imposed such increases.
	The unfortunate problem is that four of those councils are Conservative led—indeed, two of them, Birmingham and Leeds, have benefited from a joint administration with the Liberal Democrats. They are clearly not bad councils, therefore, but they appear to have been singled out for a referendum on the council tax.
	I am genuinely puzzled about how the referendum would work in helping people with the cost of living. What question would be asked? If people vote no to a proposed council tax increase, does that mean that councils would have carte blanche to cut their education budgets? Would they be free to use their reserves without being subject to the present constraints? The policy is extremely badly thought out, yet it is at the centre of the Conservatives' proposals for dealing with the cost of living.
	In the few minutes that remain to me, I want to concentrate on what I think are the two key elements in the increased cost of living that, in reality, we face. On the front of their report, the Conservatives have helpfully included a summary of the main contributory factors to what they describe as "Gordon Brown's Disaster". Those factors are nine price increases—seven of them in food, and the other two in fuel.
	What is the Conservatives' proposal for dealing with those nine price increases? Indeed, what can anyone do about them? Three of the price rises relate to dairy products—butter, milk and cheese. What is the failing in Government policy in respect of the dairy industry? How could the Government be expected to mitigate the problem? I have sat through years of painful Department for Environment, Food and Rural Affairs questions, in which the main challenge from both Conservative and Liberal Democrat Members has related to the poverty and poor returns of dairy farmers.
	That problem has been rectified through the market, so are the Conservatives suggesting that dairy farmers are now being paid too much, or that the market should not be allowed to work? I do not know, but we are talking about part of "Gordon Brown's Disaster", so I presume that the Conservatives have some idea of how the problem should be rectified.
	A much bigger problem exists, of course, and I agree with the Government motion in that much of it has to do with world trade in food. I should be intrigued to know how the Government have responded to last weekend's insane rant from President Sarkozy criticising Mr. Mandelson. I think that he suggested that Mr. Mandelson was responsible for millions of children dying of starvation because he was failing to support French protectionist food policy. That is completely idiotic, and I hope that the Government will make it absolutely and publicly clear that they do not subscribe to that sort of nonsense.
	The main contributor to inflation in the short run has been the price of energy. It is worth devoting some time to looking at how that problem has arisen. We might also consider some possible solutions to it, and whether any party has any answers.
	The rise in energy prices is partly a function of world prices but, as the right hon. Member for Wokingham (Mr. Redwood) correctly noted in an intervention, another factor is the way that the economic rent from oil is divided between Governments, consumers and producers. For the moment, though, I want to focus on the problem with world prices. It is clear that the Prime Minister thinks that he has a role to play, as he went to the middle east in an attempt to influence the producers.
	It is important to say that some foolish myths are circulating. The Government—and the Prime Minister personally—have been responsible for the first of them, as they have argued that the price of oil in world markets is being forced up by members of the OPEC deliberately withholding supply. That is complete nonsense: there is less than 2 per cent. spare capacity, and there are serious production problems in countries such as Nigeria and—because of the war—Iraq. The price rises are not due to the malicious withholding of supplies, and the Prime Minister is totally wrong to have created that impression.
	The other myth in circulation is that the price rises are something to do with wicked speculators. It may seem odd, coming from a Liberal Democrat, but I disparage that argument. It has become a fashionable argument; indeed, the leader of the Conservative party was advancing it yesterday. However, there is not a shred of evidence that there are accumulated oil stocks or that futures markets have systematically pushed prices in their current direction. Those markets affect the level of volatility, but not long-term trends.
	Speculators are clearly not the issue. There is a policy problem, on which the Prime Minister reported yesterday: there is a shortage of investment in the oil industry. I would like to have raised two issues with him at the time, and I will communicate them to the Minister. If the oil producers are so negligent in failing to attract foreign investment in the oil industry, why was the one OPEC country that has welcomed foreign oil companies—Iran—threatened with sanctions the moment it did so? Foreign oil companies were only too happy to invest in Iran, but they have been told that they will be penalised if they go there.
	I am sure that the Saudis and others have made another point to the Government, who should reflect on it. The Saudis and others would ask, "Why are you criticising us for not investing, given that you have increased additional corporation tax and petroleum tax levies on the North sea oil industry, making the west of Shetland fields completely financially unsustainable?" Through its own policies, Britain has as much responsibility as the oil producers for failing to produce a supply.

Si�n Simon: Will the hon. Gentleman say a few more words about the speculation question? Is he saying that there has not been a big shift of capital from a weak dollar into oilperhaps perfectly legitimately, and not necessarily in an abusive or speculative way? Is he saying that there has not been such a shift of capital, or simply that the shift has been legitimate rather than abusively speculative?

Vincent Cable: There is a complicated argument, and we could spend the day on it. I am trying to understand other people's arguments. When people complain about speculative pressures, I think that they are saying two different things. One is that futures markets do not function properly, although I do not think that there is any evidence for thatthose markets may be volatile in the short run, but they do not cause enormous shifts over periods of years.
	The other thing that such people are saying is that a lot of people who are nervous about investing their savings are putting them into commodity-based securities. That is the argument that the Conservative leader advanced yesterday. However, the actual magnitudes of money involved in those commodity securities is trivially small in relation to the turnover of oil markets. It is difficult to explain what has happened in any way other than through the fact that world oil demand has been rising unsustainably and that supply is fixed in the short run. That is the problem.

Rob Marris: In that context, will the hon. Gentleman reflect on his party's policy of an 80 per cent. cut in CO2 emissions in the United Kingdom by 2050? World demand for oil is increasing, and the suggestions that he seems to put forward in respect of bottlenecks because of lack of investment are a policy for increasing oil output. The rest of the world continues to use oil. The macho gesture politics of 80 per cent. cuts in the United Kingdomprobably in isolation from almost all the rest of the worldare ridiculous, given that demand for oil is increasing and will continue to increase. I urge the hon. Gentleman's party to reflect on that; otherwise, it will go on asking UK residents to undergo a painful transition, which will not prevent climate change.

Vincent Cable: This is a complicated argument, and we are getting a bit off the cost of living. However, I refer back to the excellent report produced by the Cabinet Office in 2003, under the original editorship of the then Prime Minister Tony Blair. It suggested that a very large shift to renewable power could be achieved without nuclear power and at reasonable cost within the time arrangements that we are talking about.
	The challenge to all parties is to face a few home truths about oil and energy prices. The first is that oil prices, and energy prices generally, are likely to remain high. It is important that they should, for conservation and environmental reasons and because of the need for long-term security of supply. There is no argument for pandering to populist demands to cut oil prices to the final user; that would make very little sense. Although there are real problems for people in remote rural communities, which is why we have argued for a derogation for them, motorists' costs have risen less rapidly than costs for public transport users, and that remains a basic feature of transport policy. Moreover, although British diesel prices are exceptionally high because of diesel taxation, which is one of the truckers' grievances, and a reasonable one, British petrol prices are not out of line with western Europethey are pretty comparable with those in France and Germany and lower than those in Holland, Belgium and the Nordic countries. The one European country that could, if it wished, offer its residents low petrol prices is Norwaya major oil producer that has much higher taxes and prices than the United Kingdom. Perhaps those are the truths that should be spelled out when we are talking about the high cost of motoring and the high cost of petrol.
	The one area where the Government could sensibly intervene to reduce the cost of living in relation to energy prices is gas. The Conservative document has some sensible comments to make about the wholesale market in gas, although it does not go nearly far enough. There is a lot of evidence that there is a case for a Competition Commission reference as regards the gas and electricity producers. Social tariffs are far too ungenerous in relation to the prices that companies offer to their direct debit users. As my party leader has been arguing over a period of weeks and months, there is a case for using the windfalls that producers are earning as a result of the non-auctioning of licences under the European trading scheme to ameliorate the problems faced by poor gas users, particularly pensioners. The Government could do something constructive and useful about that in the short run.
	The Government have been staggeringly complacent about the growing problems facing the economy. The Conservative alternative, at least as it has been set out today, is either feeble, in many respects, or dishonest in others. Perhaps they owe us a little more explanation of what they would do faced with this very difficult situation.

Nigel Griffiths: It is a pleasure to speak after my right hon. Friend the Chief Secretary to the Treasury. I should like to express some interest and concern about, and to give a view on, why the Opposition have initiated this debate. I am reminded of what Nye Bevan said when he was Housing Minister after the war and the Conservatives proposed a vote of no confidence. He congratulated the Opposition on their concern for the public weal in introducing a motion on a subject so embarrassing to themand today's subject is certainly embarrassing for the Conservatives.
	The favoured clich among the Conservatives at the moment is that not enough was done to fix the roof while the sun was shining. It certainly was not shining during the Conservative years, nor was it shining for the other G7 economies after 2001. As they went into recession and negative growth, wemonth after month, quarter after quarter, and year after yearexperienced continuous economic growth because of the sound policies adopted by this Labour Government. It is one of those metaphors that repays close study, because in fact we did fix the roof. There were a lot of roofs to fixin our hospitals, in our schools, in our police stations and elsewhere. The legacy of leaking roofs in our hospitals was such that we had to provide 100 new hospital schemes, as well as 2,850 new or improved GP surgeries. The hospital buildings were needed to cater for the investment in training that Labour put into the 83,000 extra nurses, 35,000 extra GPs and 33,000 extra consultants. That is why we are achieving 600,000 more operations a year. Far from whistling while the sun was shining, we were doubling investment in our national health service to a total of 90 billion. We were fixing the leaking roofs in our schools, with 800 new or rebuilt schools to house the 35,000 extra teachers.

Graham Stuart: The hon. Gentleman mentioned Nye Bevan, who said sarcastically that what the Labour party needed as a leader was a desiccated calculator. Do Labour Members, such as the hon. Gentleman, who thought that they would get such a desiccated calculator, realise that they now have a leader who is desiccated but cannot count?

Nigel Griffiths: I am sorry, Mr. Deputy Speaker, but I am being drawn into a debate here. We have a leader about whom only the most narrow-minded apologist of a woeful Conservative record would dredge up such a question. Our leader is responsible for all of the achievements that I have spelled out, along with our previous Prime Minister and colleagues in my party, but with no thanks at all to the hon. Gentleman, who voted against some the key policies involved.

Jim Cunningham: My hon. Friend was in his place when I intervened on the Opposition spokesman, who seemed to suggest that he did not grasp my point. My point, with which I am sure my hon. Friend will agree, was that one of the first things we did when we got into power in 1997 was prepare for a rainy day by cutting the debt repayments. If we were not preparing for a rainy day by doing that, what were we preparing for?

Nigel Griffiths: My hon. Friend could not be more right. National debt is now far lower than it was under the Conservatives. The Tory debt was 41.1 per cent. of GDP at the start of the 1997 economic cycle. Labour has cut that to 37 per cent., which is a lower level of national debt than in the United States, the euro area or Japan. Debt levels in every year to 2013 will be lower than the Tory debt we inherited in 1997.

Jeremy Browne: Will the hon. Gentleman touch further on the argument made by the Conservatives, which, as I understand it, is that the Government are spending too much, taxing too much and borrowing too much? However, the Conservative shadow Chancellor, speaking on the BBC's Breakfast on 3 Septemberless than a year agosaid:
	The Conservatives will spend the same as Labourif there is a Conservative Government there will be real increases in spending.
	I understand the criticisms made of the Labour party, and they are legitimate. What I do not understand is why the Conservative party is determined to ape it.

Nigel Griffiths: They mention desiccation, but these are the coconuts. That is a mad policy that has absolutely no credibility. I make this prediction to the hon. Gentleman and the House: when the scales come off the eyes of the press and media about Conservative party policies, they will see, as clearly as even the Liberal Democrats can, the shallowness and superficiality of those policies. But I want to return to the leaking roofs that are part and parcel of what was done and not done when the sun was shining.

Rob Marris: On the leaking roof analogy, does my hon. Friend agree that it was a pity that Thatcher did not thatch, and that the previous Conservative Government sent the national debt through the roof?

Nigel Griffiths: Absolutely right. My hon. Friend puts it as eloquently and wittily as ever. It is the roofs of council houses that I want to talk about next. The investment made by the Government in those, when the sun was shining, was considerablea 66 per cent. increase in real terms. There were leaking roofs in stations as well; we have had 39 new or replaced railway stations. We have tripled spending on our railway system, with 1 billion journeys being made, which is the highest number of journeys since 1961. We have had 1,900 more buses a year, and the biggest replacement of rolling stock in history40 per cent. of rolling stock has been replaced in the past seven years.
	What about a subject that Conservatives used to claim as their own, but now have no credibility on: crime?

Several hon. Members: rose

Nigel Griffiths: I will give way in a minute.
	The Conservatives ensured that police numbers fell year after year and crime doubled. We have had 13,000 more police officers in the past 11 years, with a record number of 140,000 police.

John Barrett: rose

Nigel Griffiths: I am delighted to give way to the hon. Member because he will want to tell us about the budget of Edinburgh's Liberal Democrat council and justify its closing schools, cutting 2 million from organisations that cater for disabled people and its priority of enabling Liberal councillors to buy ermine robes

Mr. Deputy Speaker: Order. That is well off the subject of the debate, so I trust that the hon. Member for Edinburgh, West (John Barrett) will not follow it up.

John Barrett: I will take your advice Mr. Deputy Speaker. Will the hon. Gentleman comment on a serious matter that is happening in our city and relates to the cost of living and the housing marketimpending redundancies in the house building industry? Will he revert to the substance of today's debate and get away from the knockabout?

Nigel Griffiths: I understand why the hon. Member does not want to respond to my points. Of course, people are having to examine their individual budgets and I am sympathetic about that. However, without the economic stability and considerable growth that we have enjoyed, which no other G7 or advanced industrial country has experienced, people would not today enjoy a standard of living unparalleled in historywe all want to co-operate to protect that. Of course, I want young couples to access the housing market. I realise that people have suffered problems and I am therefore delighted by the two thirds increase in real terms investment in local authority housing. That has been paralleled by more people than ever owning their own homes.
	Even the amount of repossessions today is a fraction of the 250,000 that happened under the Conservatives in the three years at the beginning of the 1990s.

John Hemming: Does the hon. Gentleman share my concern about the Government's calculations? When the Government examine the cost of living in their statisticsthe consumer prices indexthey conclude that average families spend more on hotels and restaurants than on their homes in the cost of housing, water, electricity, gas and other fuels. Families on lower incomes therefore face a much higher increase in their cost of living than the official statistics recognise.

Nigel Griffiths: I do not accept that. [Hon. Members: Why not?] I will explain in a moment. I am about to read from the letter of the Governor of the Bank of England, which explains the precise reason. I would have expected all hon. Members to read it before the debate. The letter, which directly covers the point, states that
	in the year to May world agricultural prices increased by 60 per cent. and UK retail food prices by 8 per cent.;
	there is obviously a discrepancy there
	oil prices rose by more than 80 per cent. to average $123 a barrel and UK retail fuel prices increased by 20 per cent; wholesale gas prices increased by 160 per cent. and UK household and electricity and gas bills by around 10 per cent.
	Bills have gone up, but the hon. Gentleman will accept that the price of retail items such as electrical goods has dropped as China and other countries have stepped up their production. The prices of other goods have also fallen. I therefore do not accept the full implication of the hon. Gentleman's commentsthat the average is higher. That is not the case.
	The Labour Government have ensured that even more money is to be given to those over 60 for the winter fuel payment this year because of the rise in fuel prices. The Chancellor keeps that under constant review. Although current prices are worrying for families, in the early 1990s inflation peaked at 10 per cent. and unemployment reached 3 million. That caused great hardship and problems. The position today is far from that.

Sammy Wilson: rose

Nigel Griffiths: I wish to make some progress.
	I want to consider some other premises of the previous Conservative Government. We have dealt with the national debt, but we also need to consider borrowing, which we are all concerned about. The Government have halved borrowing as a proportion of national income, reducing it from 3.4 per cent. between 1979 and 1997 to half that and less now. Tory borrowing peaked at 7.8 per cent. of national income in 1993, which is equivalent to 110 billion today. Borrowing next year will be well under half that, at around 3 per cent. of national income. Labour's highest borrowing is less than the average borrowing between 1979 and 1997.
	The reason we have been in a good position to weather recessions that have affected countries and why, without in any way being complacent, our economy is well placed to weather the global problems that are affecting us, with higher food and oil prices, is that we have worked with business to ensure that, at 28 per cent., our corporation tax is the lowest in the G7 and that our tax rate is the most competitive of any major economy. We have made three cuts in corporation tax since the Conservatives set it at 33 per cent.a full five points higher than it is under this Labour Government. That is one of the reasons we have 750,000 more firms operating than we had 11 years ago. Those are important facts, which the Opposition spokesperson chose to ignore.
	What else made those years, in the Governor of the Bank of England's parlance, the NICE years? The reason is partly that more people are now in work than at any time in our historyI think that the figure is 29.5 million. We can be proud that in the NICE years we took 700,000 children out of poverty.

Si�n Simon: That's nice.

Nigel Griffiths: It is nice, too, that we took 1 million pensioners out of poverty. I am pleased at that, but I know that we have got much more to do. It is good that we have put well over 1 million people into work through the new deal and it is great that 1.5 million people have benefited from the national minimum wage. I just wish that the whole House had supported those nice policies in the NICE years. It is great that we have got the extra police, the extra nurses and the extra consultants.
	If the Conservative handling of the economy during those 18 years was so wonderful, why are all the figures that I am quoting paralleled by figures going in the opposite direction during those years? Not only were those years not the NICE years; they were the nasty years. They were the years when the Conservatives thought that they way ahead for people was by investing in a private health service and in private health care, not the NHS. They despised people who sent their children to state schools, and few people believe that they have genuinely reversed those policies.
	The Conservatives presided over the two worst recessions since the war. Unemployment doubled, hitting 3 million not once, but twice. Interest rates rose to 15 per cent. The Conservatives should not lecture us about inflation. Inflation under the Conservatives was 10 per cent., with mortgage rates averaging 11 per cent. More than 1 million people were in negative equity and 250,000 people lost their homes. One in five families had no one in work and one in three children grew up in poverty. Yet in spite of the makeover, the Conservatives would still scrap the new deal. They opposed tax credits, which have helped both families and senior citizens, and they would divert money from public services. That is their real agenda, and that is why I

Mr. Deputy Speaker: Order. I call Mr. John Redwood.

John Redwood: The Chief Secretary to the Treasury and the Government make a pathetic case. They say that the rising inflation rate is entirely down to world events that they cannot control, although occasionally the Prime Minister, in his Canute-like mode, goes into embarrassing overseas meetings fatuously to lecture people who are not as guilty as he is over the price of petrol and diesel at the pump. The Government also seem to resent the fact that many millions of formerly very poor AsiansIndians, Chinese and othersare at last able to get some purchasing power in the world so that they can have a greater fraction of the standard of living that we take for granted, by buying more energy and better food products.
	We are saying to the Government that it was eminently forecastable over the past 11 years that there would be a big increase in demand for food and energy from Asian sources. That is very welcome. We were all extremely grateful that the Asian economies did so well in supplying us with an ever-increasing volume of very competitively priced goods, which kept our inflation rate down despite the errors being made in inflation policy in this country. Now, however, the Government are saying that it is all the Asians' fault for daring to buy all these other things with the money that they have earned buy selling us those cheaper goods, even though the Government did absolutely nothing for 10 years to increase our capacity in agriculture or energy, when they should have been making a contribution to the world situation.

Si�n Simon: The right hon. Gentleman is noted for being an intelligent and erudite Member of the House. If he has a case to make, surely he can do better than to use Aunt Sallies and say that the Government are blaming everything on the Indians and the Chinese. That is ridiculous. If he has a case, why does he not put forward a proper argument instead of all that sort of nonsense?

John Redwood: If the hon. Gentleman had been here for the Chief Secretary's speech, he would have heard her say that the increase in demand was all down to world circumstances, and that it had come not from Europe but from India and China and other much more successful, faster-growing economies in Asia. The hon. Gentleman has failed to make his case.
	Over the past decade, the Government could have made the decision to allow the private sector to develop the marginal fields in the North sea instead of taxing it to the hilt and putting it off. They could also have made decisions on renewable energy, nuclear energy or other kinds of energy that do not require carbon. Instead of having to have the great debate now on new power, we could have had new power stations already up and running. We have had 10 wasted years under this Government, and we now have higher energy prices as a result.
	On agriculture, instead of constantly agreeing with everything that comes from Brussels, the Government could have put some substance behind their rhetoric of reforming the common agricultural policy. Instead of having years and years of big subsidies for set-aside to prevent farmers from growing the grain that the world needs, we could have had a policy that actually promoted the growing of grain in order to make a contribution to the world scarcity of grain, both for direct eating by human beings and for eating via the animals that are increasingly in demand in the Asian countries.
	That is where the Government have gone wrong, but they wish to take every credit for the cheap goods coming out of Asia, which they say is down to their economic management. Now, they wish to take no blame for the scarcity of basics that is driving prices up, and with which they have singularly failed to help.

John Hemming: The hon. Member for Edinburgh, South (Nigel Griffiths) did not seem concerned about the fact that families on lower incomes were more dependent on basics, or the fact that, while the consumer prices index shows a 10p in the pound spend on food and non-alcoholic beverages, and 12p in the pound on housing, water, gas, electricity and other fuels, it also shows a 14p in the pound spend on restaurants and hotels. Does the right hon. Gentleman share my view that we should examine how families on low incomes are affected by Government policy?

John Redwood: That is what I and my party have been saying, and it is one of the reasons behind this debate. The hon. Member for Edinburgh, South (Nigel Griffiths) is as remote from the reality of modern Britain as those on his Front Bench clearly were during the Crewe by-election. They seemed to have no idea that the retail prices index basketlet alone the consumer prices index basketdoes not reflect the reality of low-income households, which are spending a much bigger proportion of their income on food, energy, heating their homes and trying to get some transport. The Minister admitted that those costs had shot up, and those are the people whose incomes are being most tightly squeezed.

Nigel Griffiths: If the right hon. Gentleman is so sure of his case, why has he not persuaded those on his Front Bench to make a statement saying that they are going to cut duty on fuel?

John Redwood: I am well known for believing that because there is such a rip-off at the pumps in this country and a rip-off on North sea production, we should be reducing the rates in order to keep the amount of tax coming in at the forecast level rather than over it. I suggest that the hon. Member for Edinburgh, South (Nigel Griffiths) contain himself; who knows, my Front Benchers may well come up with such a proposal in due course, but we are interested in the Government's proposals. It is their problem; they created it. They have the power to say to the House today, We are very sorry. We are collecting far more revenue at the pumps and from the North sea fields than we forecast we would in the Budget. This is a rip-off. We will give some of it back to the public.
	About 500 million of extra revenue came in from oil and petrol in the first six weeks of the financial year, but what are the Government doing with it? They have not told us how they are wasting that 500 million, but we know that they have wasted billions on computerisation, unneeded regional government in England, ID cards, too many officials and administrators and too many external consultants coming in to do the jobs that officials do not seem to be able to do so that we are paying twice for everything that goes on in the Government. That amounts to massive waste, which the Government's own Gershon review admitted, as confirmed by Conservative party work.
	At the core of the debate there should, I think, be a serious examination of one of the most misleading soundbites of the past 11 yearsthe soundbite that the Government created an independent Bank of England, which dealt with the inflation problem and gave us economic stability. The House should remember that the Government almost lost their Governor of the Bank of England when they shoved through their bodged reforms of the Bank in 1997-98. Far from making the Bank independent, they stripped it of its responsibility to manage public debt and its responsibility to have day-to-day supervision of the clearing banks.
	When the credit crunch and the crisis hit, the Bank of England was blind and deaf to its own money markets and did not know minute by minute what the Government's debt position wascrucial to the functioning of the money marketsand it did not know minute by minute what the clearing banks' position was, when they were clearly extremely short of funds. That meant that at the crucial point where the Bank needed to be expert at running the money markets to enforce the rates laid down by the Monetary Policy Committee, it was not able to do so. There was a complete collapse of monetary control across the August through to October period as they lurched from boom to bust in their handling of the economy. It was a failure of the Treasury, as well as the Bank of England; it was the tripartite system, led by the Chancellor, that led to the run on the Banka disgrace in an advanced economy that makes its living primarily out of financial services through export markets. It was a disgrace that this Government presided over such an embarrassing situation when all previous Governments had been able to keep the banking system just about liquid enough, even in bad times, so that there was never a run on the banks for more than 100 years.
	All that happened because of those bodged reforms. The Monetary Policy Committee is alleged to be independent. The Government's best case is that the MPC was made a bit more independent; clearly, the Bank of England was very badly damaged by being made less independent, as it lost big functions. Even the MPC was not really made independent, however. Let us remember the record. Before the 2005 election, the Government clearly wanted lower interest rates, so they fiddled the target. They replaced the retail prices index targetthe RPI is used in all the index contracts; the RPI is used for wages and indexed debtand substituted the consumer prices index. Why did they do that? They did it because they knew it would go up less quickly, which would mean easier money and lower interest rates. I see the Economic Secretary shaking her head, but she is an intelligent woman and she knows that that is why they did it, and the adjustment to the target rate was not sufficient to take into account how big the gap was between the more truthful RPI and the less truthful CPI in respect of the prices that people were having to pay in our economy. We had that damage.
	There is also the problem that we were never told why some members of the independent MPC were reappointed and others were not. I tabled questions asking about the criteria for reappointment. I asked whether there was some external test for reappointment, whether the voting record was examined and whether only the dovish ones who would vote for lower rates before elections were reappointed. No answer was forthcoming from the Treasury. This Government, who introduced the Freedom of Information Act 2000, will not even tell a Member of this House of Commons why they reappointed some MPC members but not others. They will not even tell me what the criteria were for trying to create some independence for that committee.
	When the crisis struck in August and September, the MPC was as much use as a bunch of people having a tea party but no control over the financial markets. There is no point in setting independent bank rates if we cannot enforce them in the market. The Bank needs to have enough control over the money markets and enough knowledge and skill within those markets that its rate is the crucial rate. It lost control and the damage was there for all to see.
	We have a Government who mis-sold the proposition that they created an independent Bank. They have mis-sold the proposition that they created stability as they created instability. They have still not got a grip on this situation. We had the big lurch from too much liquidity and low interest rates between 2003 and 2006 to interest rates being too high and too little liquidity in 2007. We had the run on the Rock. We then had a welcome reduction in that illiquidity. Money was belatedly injected into the markets and interest rates were lowered a bit, because the Government suddenly realised that fighting slowdown or recession was more important than fighting the inflation that they had already created.
	More recently, we have had a lurch the other way. The Bank and the Treasury seem to be worried again about the inflation, which they cannot control because it relates to their past mistakes. This lurch is happening at exactly the point where the housing market is in collapse, the property market is in collapse, there is a second phase to the credit crunch and there are problems with mortgage banks and others because of the extreme squeeze that the Government are putting through. The price of that lamentable failure of monetary policy, the botched reform of the Bank of England and the lurch from boom to bust and from boom to bust again in credit and money markets will be severe for people in this country to pay.
	My hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond), the shadow Chief Secretary, valiantly tried to get the Chief Secretary to say something true from the Dispatch Box. He said to her that the adjustment to the credit crisis and the inflation crisis triggered by the Government must surely come through lower living standards. That is what the Chancellor's policy is all about when he says that people cannot have RPI-matching pay awards. He has said that public sector pay should go up by considerably less than RPI and is now trying to talk the private sector into exactly the same position. Perhaps he has not realised that a lot of the private sector came to that conclusion a long time ago because it is struggling to remain competitive in an extremely competitive and difficult world.
	I hope that the Economic Secretary will remedy the defect created by the Chief Secretary and admit to the House that, yes, it is now Government policy to squeeze individuals and families for at least a year to try to deal with the excesses that the Government have put into our economy. Looking at what the Government have been doing for the last couple of months, it is quite obvious that they have no intention whatever of the public sector making any contribution to reducing the excess spending and credit in our economy, which desperately needs to be sorted out after the boom yearsthe years of neglect, the years in which the Bank and the Treasury so singularly failed to stay married to prudence and to keep things under control.
	I have often pointed it out in the House that I believe that the Government balance sheetthe nation's balance sheethas under this Administration seen a ballooning of debt, but not of 550 billion or 700 billion. If the unfunded pension liabilities, which would be on any company balance sheet, the private finance initiative, the public-private partnerships, Northern Rock and all the other promissory notes that they have issued, as well as all the debt that they are now adding to the balance sheet were all added in, the true figure would be about 1.5 trillion.
	I am beginning to feel that I have underdone it, because on no occasion has a Minister rushed to the Dispatch Box to say, The right hon. Gentleman is over the top. The actual figure is so and so. The Government have never put out a press release countering my blog's exposition of this. The Economic Secretary looks downwards, so I suspect she is saying, Gosh, we've got away with it. He thinks it's only 1.5 trillion.
	Let us say that the figure is about 1.5 trillion. That is colossal. It means that the IOU cupboard will be full to bursting by the time the new Conservative Government get in and try to sort things out. It means that we have no room for manoeuvre because the Government have been so wanton over the past few years, yet in the past few weeks they have found 2.7 billion of extra borrowing to try to impress the voters of Crewe. Didn't they do well? They have found a lot of extra borrowing for transport systems in Manchester and the north-west, presumably because they are worried about their position in that region. They have found a lot of extra money to win the 42-day vote, and might have to find a lot more to win that vote all over again, assuming that their lordships disagree.
	This Government are now on a rake's progressthey have not merely divorced prudence but fallen in love with a much wilder lady who clearly believes that the public sector must have everything, however much has to be borrowed, putting more and more pressure on the individuals and families whom we all represent.
	The charge against the Government today is that their reforms of the banks failed; their monetary policy failed desperately badly in '07 and is still wobbly today; they do not have a grip on the money markets and the interest rate structure, let alone the inflationary consequences; they have absolutely no grip on public spending, which is why all the pressure will be on individuals and families; and they do not seem to care about the way in which our constituents are having to suffer.
	If the Government want to solve the long-term problems, as they always say in their rhetoric, will they please make some decisions, even at this late stage, to get some transport capacity and energy capacity in, and to move away from such a strong dependence on inefficient carbon-burning machinery in both sectors? That is the way to do something about energy costs. Will they please go to Brussels and get some change to the common agricultural policy, because we need a policy that promotes and generates much more agricultural activity? We need to see the plough moving up the hillsides out of the valley beds. We need much more land brought back into use. The world needs food, and we need to make our contribution; it is no good blaming the Chinese and the Indians.

Several hon. Members: rose

Mr. Deputy Speaker: Order. If I am to be fair to everyone who wants to speak in the debate, I should now reduce the time limit to 12 minutes. With any luck, and without too many interventions, we might be able to ensure a complete tally of the hon. Members who wish to contribute.

Sally Keeble: It was interesting to listen to the speech of the right hon. Member for Wokingham (Mr. Redwood), because his critique included points that I have never heard him raise previously. During all the time that the CAP was being renegotiated to decouple subsidies from food production, I never heard him make the point that we should use the CAP to increase food production. Nor have I heard him argue previously for increased support to ease the pressures on low-income families. More of his critique was based on his profound disagreement with this Government's overall economic policiesthat is clear, as he is in a different party and has different priorities.
	Today's debate touches on one of the most fundamental issues affecting our constituents: their family finances and budgets. A lot of the debate is fairly self-evident. It is obvious to anyone that the cost of living is going up, and that there are differential increases between the rise in the costs of fresh food and in those of manufactured food and manufactured goods generally. For example, the cost of clothing, which is an important factor for many households, has gone down by 6.7 per cent.
	It is also clear to everyone that the cost of fuel has gone up. If we examine the details, we see that we are in the third phase of very large fuel price increases. In the first, in 1973, oil prices quadrupled, producing sharp inflation. In the second, in 1989, oil prices went up two and half times, which was a major factor in a massive recession. Since then, oil prices have gone up from $30 a barrel to about $140, and those costs have substantially been managed and absorbed, albeit that we now see the pressures. It is also clear to everyone that apart from fuel prices, a major factor in the cost increases is the increase in commodity prices. People have seen food riots happening in countries around the world.

John Redwood: The hon. Lady is making some good points about the impact of food prices on her constituents. Can she explain why no other Labour Members want to hear about that? Do they not understand it?

Graham Stuart: Where are they?

Sally Keeble: They probably decided to leave it to me, in the sure knowledge that I would make a good job of it. This issue of is of concern to me because it is of profound concern to my constituents, and I think it right for questions about it to be dealt with. There is also the impact on family households of the credit crunch, which, although it may not be immediately apparent to some of them, is felt through pressures on house prices and house building.
	I have to say that I disagree with the detailed analysis presented by the right hon. Member for Wokingham. Having sat in the Select Committee and listened to explanations from the Governor of the Bank of England and others, I have not heard them blame the restructuring of the Bank in 1997 for the credit crunch, although there have been arguments about the tripartite arrangements. Most of my constituents probably realise that whatever mistakes were made in that regard, much more profound mistakes were made by the board of Northern Rock and much more substantial problems arose in the sub-prime market in the United States, which continue to affect our lives and those of our constituents.
	What my constituents probably want to know, much more than they want to hear tit-for-tat arguments between the political parties, is what will happen in the years to come, and which party has the policies to take them through what everyone knows, and what the Governor of the Bank of England has said, will be a difficult time for quite a while. He said it would be difficult until next March or April, and I am sure he is right. This has to do not just with how much the cost of living goes up but with what happens to family incomes, and ours is the party that provided a safety net for family incomes through the minimum wage.

Graham Stuart: I am sure the hon. Lady knows, through her membership of the Select Committee, that real disposable incomes have not risen for many years, except for those at the very top of the pile. What my constituents want, and what traditional Labour supporters want, is a Labour party that cares about the incomes and costs of living of those who have least in society.

Sally Keeble: rose

Graham Stuart: The fact that

Mr. Deputy Speaker: Order. I cannot allow two Members to be on their feet at the same time arguing with each other. The hon. Lady gave way to the hon. Gentleman; now it is her turn again.

Sally Keeble: Thank you, Mr. Deputy Speaker.
	What the hon. Gentleman has said about earnings is completely untrue. In fact, there are two issues. During the last big recession, when wages fell, the hourly rate for people doing basic jobs, such as grass-cutting, in London fell to 1.20. There was no minimum wage; it was a case of How low can you go? The union members who are now arguing for pay increases were then struggling to get wages raised to 1.20 an hour for key public sector jobs in the capital. People were being bussed into London to do those jobs. Now we have a minimum wage that provides a safeguard for people, and they know that whatever the cost of living, they have that protectiona protection given by this party in government.

Graham Stuart: According to the Institute for Fiscal Studies,
	Real income growth... was close to zero
	across most of the income distribution
	between 200506 and 200607. Only incomes towards the top... showed...growth
	much above zero.

Sally Keeble: The hon. Gentleman is talking about only a couple of years, and about different sections of the pay scale. If he were to look at the figures over a period of time, they would be quite different from those he has quoted.
	People facing difficult times want the reassurance that however much prices increase, their incomes will be safeguarded. If they have a family, they will also want to know that the party in government understands that having children costs more, and that those costs need to be covered. That is why this Government were right to increase child benefit and to make changes to the tax credit system to ensure that in difficult times people know that some safeguards are built into the system for their children. That has been a hallmark of this Government, and the Conservatives have consistently opposed it.
	I must add that the Liberal Democrats have also consistently opposed that, too. Their attack on the Conservative party during the debate has been disgraceful, because I am sure it is mostly to do with the Henley by-election, after which they will resume normal business and criticise us instead of the Conservatives.

Daniel Kawczynski: A very well made point.

Sally Keeble: I am grateful to the hon. Gentleman for his support on that subject.

Jeremy Browne: I am extremely flattered that the hon. Lady thinks that anything I say in this Chamber will influence the vote in Henley. The point that I and other Liberal Democrats have consistently been making is that, given that Labour has presided over such a mess in our economy, it is extraordinary that the Conservative party has chosen to adopt Labour party economic policies lock, stock and barrel.

Sally Keeble: If the Liberal Democrats care about what happens to people during these difficult economic timeswe must all accept that we are currently going through difficult economic times, and that they will continue for a whilethey should be committed to policies that protect those on low pay and families, and give people the chance to rebuild their families' finances, and help to build the UK economy.
	This Government's other big commitment is tackling child poverty. I am sure that the hon. Member for Beverley and Holderness (Mr. Stuart) will produce some recent figures showing an increase in the number of children living in poverty. However, if he looks at the Joseph Rowntree report produced last year, he will see that the big increases in child and pensioner poverty both occurred during the '80s. It is widely recognised that the current Government's policies have served in particular to increase the incomes of families with children and those of pensioners, which is why much of the recent debate about the tax credit and the 10p tax rate focused on the single working poor. When my hon. Friend the Minister winds up the debate, I hope she will say what the Government will do to make sure that the incomes of people in that group are protected as well.
	I have a few further points to make about those policies of ours that will particularly stand my constituents in good stead. I well remember that during the last recession the nutritional value of the food consumed by some of the children in our capital city deteriorated to an unacceptable extent. The Government have done good work on food for schoolchildren, such as making sure that schools have kitchens and that children have free fruit, and similar support will be important now. That is a crucial element of this Government's commitment to protecting people on low incomes. Another is the winter fuel allowance. That replaced the Conservatives' awful cold weather payments, which in fact left most people cold during the winter.
	One of the biggest changesand one of the major ways in which the Government have equipped people to withstand recessionis the strong commitment to employment and job creation. That, above all, will make it possible for people to manage, although there will be problems with pay and the cost of living. In particular, it will make it possible for them to maintain their mortgage payments and keep their homes, which is extremely important.
	When my hon. Friend the Minister responds to the debate, I will be grateful if she deals with the following points in particular. What steps will the Government take to support single working peopleparticularly young peoplewho will face difficult times in the coming period? Secondly, might the Government extend some of the fuel poverty provisions? We have been incredibly generous to pensioners with winter fuel payments, but might that be extended to people with disabilities and people with young children, who will also find it difficult to pay their fuel bills if prices increase further and their income does not? Will she also think about driving costs, which particularly affect people such as my constituents who live in an area that does not have very good public transport to take them to work, and many of whom work shifts? In particular, will she consider the Council of Mortgage Lenders proposals for providing some support for families who get into financial difficulties with their mortgages, so that they do not have to wait nine months to get relief? I am sure that that will be an increasing pressure for some families, and I would be grateful if she addressed that point.
	Finally, let me repeat that I believe that people will see that it is our party and our Government that have the policies to carry them through the difficult months ahead.

Geoffrey Cox: A Department for Communities and Local Government report released this April measured according to seven indices of deprivation. One of them was Barriers to...Services, half of which consisted of geographical barriers. This is the index of deprivation that measures distance from a GP surgery, a general store or supermarket, a primary school and a sub-post office. England was divided into 32,000 areas, and the wards of Bridestowe, Forest and Milton Ford in my constituency are in the top 100 most geographically deprived areas in the country, while Walden, Two Rivers and Broadheath are in the top 200, and no fewer than 21 parishes in my constituency are in the top 1,000 of those 32,000 wards.
	In a rural area such as my constituency, the key indices of the cost of living include in particular heating oil, which has doubled in price in the last year. On 25 June last year, the price of heating oil across the country averaged 32.5p a litre; today the price is 60p a litreand some research undertaken by my office proved that in my constituency a bulk order of 500 litres of heating oil costs on average 62.3p a litre. How is a pensioner household in a small village or hamlet in Torridge and West Devon, or in the rest of rural England, to cope with a doubling in the cost of heating oil, which in rural areas is usually the only choice people that have for heating their home?
	The diesel price in the south-west has risen by 27 per cent. since 2005. It cost 97.6p per litre, on average, in June 2007. It is now selling in my constituency at 1.349 per litre, and that was just yesterday. These rises in costs fall oppressively hard on those who live in remote and isolated rural communities. They have no choice but to travel from their village into the nearest market town, and often that is 15 or 20 milesa 40-mile round trip.
	The burden of my short speech today is this. If, as we all acknowledge, the cost of living is risingand if, as the Government say, many of the causative factors are to be laid at the door of the global situation, rather than being a result of the Government's actionwhy on earth are the Government about to make the situation worse? Why are they to load more tax on diesel? Why are they to increase the operation of motor cars in rural areas?
	Let me give you, Mr. Deputy Speaker, and the House a reason why that burden falls more heavily on the rural dweller than on the city or the town. In my constituency car ownership is very high, but that is not because the residents of Torridge and West DevonTorridge being the most deprived district in Devonshire and one of the three or four most deprived districts in the south-westare rich. It is not because they gratuitously indulge themselves, like Toad of Toad Hall, in a casual drive on a Sunday afternoon. It is because they need a motor car to get to the nearest service. It is because they need it to reach a doctor or a pharmacy. It is because they need it to reach an essential service that they require.

Brian H Donohoe: Will the hon. and learned Gentleman give way?

Geoffrey Cox: I will not just for the moment; time is short.
	A rural dweller in a countryside community of the type that I represent needs a motor car, and often those motor cars will be old. Frankly, they will just about be roadworthy. With a bit of sticking plaster and a bit of tender loving care, they will have passed their MOT, but they will not be Rolls-Royces or limousines such as those in which Ministers sail into this House of an afternoon; they will be older cars. And what have the Government done to those who cannot afford the rich carsthe Jaguars and the BMWs? Why, they have decided to double vehicle excise duty on older cars. So not only do such people experience difficulties buying the diesel and the heating oil that they need to live; on the motor car that, by scrimping and saving weekly, they manage to keep on the roadjust aboutthe Government are about to double vehicle excise duty to hundreds of pounds more. Ministers look upon that with indifference. I see them smiling. The inhabitants of the rural communities whom I represent have no cause to smile. An extra couple of hundred pounds a year will be a serious burden on these people. It is a keenly felt axe upon their quality of life.
	What else do the Government do to improve the lot of the communities whom I represent? They close their post offices.

Brian H Donohoe: Will the hon. and learned Gentleman give way?

Geoffrey Cox: No, I will not give way; time is short.
	Twenty post offices in my constituency are to close. In 20 small rural villages, hamlets and communities, 20 post offices are to close, and of that 20, seven are the last shop in the village. Where are the villagers to go for their essential supplies? Why, they have to climb into their old car or their disability buggy and travel all the way to the nearest market town. How is it consistent

Jeremy Browne: Will the hon. and learned Gentleman give way?

Geoffrey Cox: No, I will not give way. Many people want to speak, and I am going to be quite brief.
	The position is this. The Government, at a time when the axe of the cost of living is falling keenly on the people whom I represent, are going to increase their costs with taxation and by withdrawing their services from rural communities. It is no laughing matter to the communities whom I represent to close post offices that are the last shop in the village.

Jeremy Browne: Will the hon. and learned Gentleman give way?

Geoffrey Cox: No, I will not give way.
	Those people will have to climb into their cars and drive miles, at great expense, given the heightened cost of fuel, to reach the essential source of supply that village shops and post offices represent. But the Government are not going to stop there. They are saying in their White Paper that they are going to close doctors' dispensaries in small villages within a few miles of a market town. So again, the elderly, the infirmthose who otherwise would not have to travel into a town to get their prescriptions and repeat prescriptionswill have to go into a town to visit a pharmacy, rather than having on their doorstep the service that they require.

Brian H Donohoe: Will the hon. and learned Gentleman give way on that point?

Geoffrey Cox: No, I will not.
	The withdrawal of these services will cost extra money, at a time when the cost of travel, heating and fuel is rising exponentially. Water charges in the south-west have risen by 27 per cent. since 2005. We have the most expensive water charges in the country. The nearest average water price is 100 lower, in Wales. The truth is that those charges are falling heavily upon rural dwellers.
	I listened with incredulity to the hon. Member for Edinburgh, South (Nigel Griffiths), who gave us the most astonishing apology for the Government's behaviour over the past 10 years. Not for the first time, I felt that I was inhabiting a different world.

Brian H Donohoe: Hear, hear!

Geoffrey Cox: Well, we will let the people of the country decide who is living in the real world and who is not, but I tell you what, Mr. Deputy Speaker: I represent a shire county, and the people whom I represent know that they are not living in a Labour area. They know that they do not have new hospitals and new roads; they know that they do not experience the same investment. They know that there are two Englandsthe England represented by the Labour party, and the England represented by Conservatives and evenGod help us!by Liberal Democrats. People there do not get that type of investment. The south-west has suffered again and again from neglect, indifference and failure to represent communities in the areas that I represent.
	I do not want to go on for long, Mr. Deputy Speaker, but I do have a constructive suggestion. Why does the Minister not say now to the people and communities whom I represent that the Government will not introduce their proposed 2p a litre fuel price rise at all? That would at least cause a sigh of relief to break out in all the areas of the south-west of which I speak. Why do the Government not abandon the vehicle excise duty proposals, which will fall harshly on those whom I represent? Why do they not stop the post office closure programme, so that people will not have to travel 15, 20 miles and more to the nearest market town?

Jeremy Browne: Will the hon. and learned Gentleman give way?

Geoffrey Cox: No.
	Why do the Government not speak to the GP surgeries, from whose patients I am receiving hundreds of letters expressing worry about the removal of their dispensary, because that is where they need to go and it saves them money to do so? If the Government were seen to be consistent, rather than contradictoryif they were seen to be uniform in their approach to these problems, thinking them through in a coherent fashionthe people whom I represent might be less disenchanted, less cynical, less sceptical and, frankly, less disbelieving in this Labour Government's credentials to govern. But since the Government seem committed to proceeding upon their current damaging and destructive coursesince it seems, as the hon. Member for Edinburgh, South demonstrated with enormous clarity, that they are about as removed from this planet as the current NASA lander on MarsI suspect that the people will wait, biding their time for another 18 months or so, until they have the chance to eject this Government and bring in something new. Let us hope that that happens as soon as possible.

Daniel Kawczynski: My favourite expression in politics is that business is the workhorse that pulls the social welfare cart, and I feel desperately passionate about that. A lot of my politics is geared toward thinking about how we can create a good environment for businessbe it large or smallto thrive in this country, to compete in a global world and to produce the prosperity that we all desire for our country, which can then be shared with the public services and the public sector. The problem we have is that over the past 10 years the Labour Government have not constructed the ideal environment for those companies. Many Shropshire business people say to me, We are still here only because we think with our hearts, we are proud Salopians and we have a duty to our workers. If we were thinking with our minds, we would have shut up shop and started our business somewhere else in the world where it is more economically viable to allow a business to thrive. Such a situation is very damaging.
	It was Ronald Reagan, when he was standing for election against President Carter, who asked the American people:
	Are you better off than you were four years ago?
	They clearly were not better off, which is why Ronald Reagan beat President Carter. The same thing will happen when Britain has a general election in 2009 or 2010, because we will ask the British people whether they think they are in a better position than they were in 2005. It is commonly accepted that things are going in the wrong direction.
	Many people have spoken about the cost of fuel increasing, and that is the biggest threat faced by rural communities such as Shropshire. My hon. and learned Friend the Member for Torridge and West Devon (Mr. Cox) has mentioned the problems that rural communities face in respect of petrol price increases. I met a delegation of 50 Shropshire haulage industry operators the other day, and they are appalled about what is happening to their industry. They are on their knees and they do not see how they can see out the year if petrol prices remain at current levels. One thing that would cost very little would be for Ministers to impose a tax on foreign hauliers using our transport system. That would be a relatively cheap measure for them to introduce, but if we are to save Shropshire's and England's haulage industry, it is pivotal that the Government undertake it.
	I do not mind saying that, again, the Labour Government are pouring money into certain inner-city areas at the expense of the rural community, and I have every sympathy with the comments made by my hon. and learned Friend the Member for Torridge and West Devon. The Government's grants to Shropshire county council are so minute that volunteers who undertake extremely important work, be it providing meals on wheels or another type of important voluntary activity, come to my surgery to tell me that the mileage allowance that they are paid by the council does not even cover the cost of operating their motor cars to undertake those vital services on which people in remote rural areas and villages depend. That is an absolute disgrace, and I hope to hear from the Minister on that issue.
	In last week's European debate, I called on the Prime Minister to go to Saudi Arabia, and as chair of the all-party group on Saudi Arabia, I am glad that he heeded my advice. He tried to say that the ball is in the court of the Saudis and the Organisation of Petroleum Exporting Countries and that they must start increasing production in order to lower the cost of petrol. However, as has been said on many occasions throughout this debate, he is responsible for massively ramping up taxation on petrol in this country. We might want to convince the Saudi Arabians and others to increase production, but friends of mine in Saudi Arabia say, Your Government have to start by cutting their taxation on petrol before he will convince us to take the issue seriously.
	As my hon. and learned Friend the Member for Torridge and West Devon aptly said, the Government are exacerbating the problem. He mentioned the post offices in his constituency that are threatened with closure.

Jeremy Browne: Will the hon. Gentleman give way?

Daniel Kawczynski: Certainly not to the hon. Gentleman, because he has been a total apologist for the socialists throughout the entire debate, and this is all about scrutinising the Government.
	I would like to talk about the post office closures in my constituency. As my hon. and learned Friend mentioned, many rural villages totally depend on post offices.

Jeremy Browne: rose

Mr. Deputy Speaker: Order. I think the House gets quite irritated when Members have indicated clearly that they have no intention of giving way, yet Members constantly seek to intervene; there is a point when that is possible, but there is also a point when it is really not a good idea.

Daniel Kawczynski: Thank you, Mr. Deputy Speaker.
	The post office closures will just exacerbate the problem that I have been describing. In addition, my county council does not receive enough money for providing bus services. Bus service 557 in my constituency is being discontinued simply because not enough subsidies are being given to my council. Not only are the post offices being closed, but the vital bus routes that take people from rural villages to the county town of Shropshire are being cut.

Brian H Donohoe: If the hon. Gentleman had been present at this afternoon's meeting of the all-party group on light rail, he would have heard Brian Souter, the chief executive of Stagecoach, saying that, after doing a survey across the whole country, he has never known a time when the bus industry has been on such an upward trend as it is todaythe same is true of the railways. Indeed, that applies not just in the city centres and town centres, but in the rural areas. Would the hon. Gentleman not accede to the fact that the way forward when petrol prices are high is for people to transfer from their cars to the buses?

Daniel Kawczynski: I must tell the hon. Gentleman that the experience in Devon and Shropshire is very different. I am only sharing with the House what constituents are saying to me. A delegation of pensioners from Pontesbury who came to see me in my surgery were incandescent about the fact that these rural bus services are going to be cut.
	My hon. and learned Friend the Member for Torridge and West Devon mentioned the cost of heating oil, which is also an important point in Shropshire. Rural villagers depend on heating oil to heat their homes. I, too, undertook some investigation into this matter. On 18 February 2007, heating oil cost 39.9p a litre, whereas today it costs 58.75p a litre, which is an increase, in Shropshire, of 147 per cent. Everybody will be paying an extra 340 for a tank load of 1,800 litres, and as certain families normally use up to two tanks, we are talking about an additional cost of 680 for heating oil. Those figures were provided by Oakley's Fuel, a company in my constituency. The Minister should, of course, be providing grants for individuals to have microgeneration and heating pumps in their homes, rather than have people being dependent on heating fuel. I saw such things being used in Sweden in early 1980s, so they are relatively old technologies, and we should be using them.

Anne Main: My hon. Friend is making a very valuable point about fuel poverty, on which the Government have been completely missing their targets. It affects many constituencies, including mine, and the Government have been sorely lacking in terms of giving lots of ways to tackle fuel poverty. I am thinking of not only financial means, but advice and helping people to insulate their homes.

Daniel Kawczynski: Yes, I have many problems with the Warm Front scheme, which is not operating properly in my constituency. The largest organisation in my constituency is the Shrewsbury senior citizens forum, which has more than 5,000 members, many of whom are extremely upset about the lack of help from Government on heating allowances.
	The reason why the Government will not be providing individuals with grants for heating pumps and other technologies to heat people's homes is because of the financial mess into which they have got our country. There is no doubt about that. We are now more than 700 billion in debt. That is the figure I always use, although my right hon. Friend the Member for Wokingham (Mr. Redwood) suggested that the real figure could be up to 1.5 trillion. The levels of debt are extraordinary. This year alone, the socialists have borrowed more than 40 billion just to keep the economy afloat.

Jeremy Browne: You are in favour of the same level of tax.

Daniel Kawczynski: I have said that I will not take interventions. If the hon. Gentleman seeks to intervene, I shall say no, so I do not know why he is making any points.
	The problem we face is that there is absolutely nothing in the kitty to kick-start the economy as we are going into leaner times and our constituents are finding it difficult to make ends meet. One can always think what one likes about the American Government, but they have injected massive liquidity into the economy and given huge tax rebates to their constituents. They see the inherent danger of the coming recession and they want to help individuals to start spending again so that the economy picks up. That cannot happen here, because the Labour Government have borrowed and borrowed. They even had to borrow to sort out the 10p fiasco.
	I shall give the Minister the example of a lovely couple who came to see me; they are happy for me to share their details. He is 84 and she is 83, and they live in the village of Dorrington, where they have to run a bed and breakfast to make ends meet. They cannot afford to live on their pensions, so they have turned their home into a B and B. That is astounding in what is allegedly the fourth largest economy in the world.
	One reason our economy is not growing as quickly as it should is that hardly anyone in the Labour Government has any experience of business. The whole debate has involved criticising what the Conservatives did in the 1980s or 1990s, without even a flicker of thought as to how the Government could improve their management of the economy, or what they could learn for the future. It has been very disheartening, especially the speech by the hon. Member for Edinburgh, South (Nigel Griffiths). I have never heard anything like it. For the people who are watching this debate on their televisions

Mark Field: Three of them.

Daniel Kawczynski: There are only three of them because they are so disheartened by the appallingly low quality of the debate, especially from the hon. Member for Edinburgh, South, whose speech was very arrogant.
	I jumped at the chance to speak in this debate. The cost of living is very important to my constituents, be they young families or senior citizens, as it relates to how much they pay at the pump, or for their food and everything else they need to keep their households going. This debate is far more important than so many other debates that we have, and for the Labour Benches to be so bereft shows how out of touch the socialists have become. They do not see living standards as being of any importance.

Mark Field: Having so recently heard the sermon from the heart of Devon, I almost feel a little guilty, as an urban Member, for saying a few words. I appreciate that the Minister's constituency contains both rural and urban areas, and I hope that she has taken on board the strength of feeling about fuel duty and the cost of living for many rural constituents.
	The issue of the cost of living has not just come to the fore in the past few months. It has made the front pages of newspapers and been the lead headline in many news bulletins in only the past six to nine months, but the increasing cost of living has been a fact of life in London for some time. It was one of the main reasons why we had the largest swing in the country at the last general election.
	I share the alarm of many of my hon. Friends at the complacency of the Government, as shown in the speeches by the Minister and by the hon. Member for Edinburgh, South (Nigel Griffiths). This Government were happy to take undue credit when things were going well for the economy, but over the past 12 months they have argued that the problems are due to global causes. There are some global issues, and it would be wrong to deny that entirely, but the public have been so hostile because the Government sought to claim that the days of boom and bust were gone and to take credit for the economy being in such an apparently strong position.
	I confess that I used to sigh with depression whenever the then Chancellor of the Exchequernow Prime Ministerand other members of the Treasury team would compare our economic performance with that of France, Germany or other G7 countries. The reality of the global world is that the competition we face is from India and China, those two economic superpowers of the 21st century. With 2.5 billion people, they will make far more important competitors than many European countries, and if we do not learn how to adapt our economyas we evidently have not learned over the past decadewe will all suffer.
	One of the biggest issues connected with the cost of living is the high levels of income tax paid by the poorest in our communities. The very fact that people start paying income tax when they earn barely 105 a week is a nightmare. It is an especial problem in London and the south-east, where even people doing the worst-paid, part-time jobs pay income tax. The Government will no doubt point out that tax credits make a difference, but the hon. Member for Northampton, North (Ms Keeble) was very complacent. She gave undue credit to the implementation of the minimum wage. It has made a difference to many of the less well-off in our society, but there is a price to pay for that, and we are beginning to pay for it as the economy slows down.
	In London, there is a thrivingindeed, an over-thrivingblack economy. We rely on many thousands of immigrants being willing to earn relatively small amounts of money, often paid in cash. One of the biggest indictments of some of the broader aspects of this Government's policy is that London now has the highest level of unemploymenta total inversion of the position in decades gone by. That is in part because too many Londoners lack the aptitude or the skills to hold down even the most basic jobs. They often live in social housing, which is very scarce, and that has the makings of some serious social unrest in the years ahead.
	It is very rare in any bar or restaurant in my constituencyor, I suspect, any of the other 73 London constituenciesto be served by a British national. The servers will be Lithuanians or Poles, or from some other far-flung country, doing some of the relatively unskilled but important jobs in the hospitality sector. That has the makings of a disaster in the future, as unemployment rises. It will not be those who come here short term, to earn some money and learn the language, but our indigenous British who end up unemployed without the skills or aptitude to hold down a job.
	The motion refers to the Government's excessively loose fiscal policy, and some fair points were made by the hon. Member for Twickenham (Dr. Cable) when he said that we would have to ensure that public spending fell or taxes would rise. The state of the public finances is dire, and my right hon. Friend the Member for Wokingham (Mr. Redwood) rightly pointed out, with some trepidation, that he had said that the overall burden was 1.5 trillion, but he had had so little negative comment on that that he suspected that the situation was even worse.
	Only last year, the Government made it clear that they reckon that this year we will be in hock to the tune of 43 billion. Add to that the 2.7 billion for the Prime Minister's get-out-of-jail-free card for the 10p tax band, and the other 1 billion or so that will be paid for Manchester's Metrolink, and I suspect that the outturn will be significantly worse, not least because the figure of 43 billion was put forward at a time when the economic clouds had not darkened in the way that they have over the past few months. There are some problematic times ahead.
	Above all, I have had the opportunity to speak in this House on many occasions about the long-term problems, as I see them, in relation to private finance initiatives, public-private partnerships and all the off-balance sheet financing. They are a disaster in the making and the complacency of the hon. Member for Edinburgh, South was breathtaking. He can talk about the new hospitals and schools, but where is the money coming from? It has not been paid by this generation. It is effectively jam today to be paid for by generations to come. Our children and our grandchildren will foot the bill.
	I would not tend to use the word socialist, as my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) does, but in many ways the genius of the idea from the Prime Minister's point of view is that the room for manoeuvre will be limited for any future Conservative Government, just as, in many ways, the success of privatisation was irreversible once the Labour Government came in to play. Even railway privatisation, which happened in 1996, was not reversed in 12 months when the Labour Government came in to play. The same will happen, I fear, but in reverse, with the increase in public expenditure that is a requisite part of the PFI burden. That tax will have to be paid during the course of the next two decades and that will make the room for manoeuvre more limited.
	I fear, in a way, that we might have an election in the next 18 to 24 months, because we will have to take on an economic inheritance that will lead to an appalling state of affairs.

Nigel Griffiths: Will the hon. Gentleman give way?

Mark Field: No. The state of affairs will be far worse than it was in 1979at least at that point we had had two and a half years of monetarism courtesy of the International Monetary Fund, after the Labour Government had to go cap in hand to the IMF. As we have already seen, there is little doubt that the Government seem set on effectively borrowing against the bank and they keep on borrowing and spending. There are only two ways in which they can possibly get out of the political hole in which they find themselves. One is to make borrowing grind to a halt and the other is to keep on spending to ensure that the cost of living problems to which we have referred will seem to be better for the purposes of an electorate who, they hope, will be grateful come election time.
	This country has some severe problems ahead, I fear. The cost of living is an issue that the Government, in their arrogance and complacency, might have thought that they had put on the back burner over much of the past decade, but it will be the leading issue in relation to not only off-balance sheet financing but day-to-day costs. The real worry, which I hear when I speak to constituents who are perhaps slightly older than I amin their late 40s and early 50sis that they worry that the situation for their children will be a lot worse than it has been for them. They worry that they cannot pass the standard of living that they have come to take for granted for themselves on to a future generation. Outside wartime, I think that that is roughly the first time in history that that has happened. That would be the worst indictment of the Government's complacency. The past decade was the best of times. So much should have been invested rather than frittered away. We will see, I fear, the disasters of those years in the decade or so to come.
	I thank you, Mr. Deputy Speaker, for allowing me to make a brief contribution to the debate. It has been an important debate and I am sure that we will return to many of the themes, as we rightly should, in the months and years ahead.

Graham Stuart: This has been an interesting debate, in so far as we have had sober, thoughtful speeches from MPs on the Conservative Benches, who, like me, spend every weekend on the streets talking to people in their constituencies.
	Every Saturday morning, I try to run a street surgery, as I call it, on a street corner in one of the four towns in my constituency, whether on Toll Gavel in Beverley, on Newbegin in Hornsea, in Withernsea or in Hedon. Week after week, people come to speak to me, take me aside and talk about the difficulties that they are having in meeting their basic bills. I have been struckand pleased, as someone who wants to see a Conservative Government and believes that that would be good for this countryto find that people say, I've always voted Labour, but now I'm going to vote Conservative. When we look at the context in which people say that and at the weight of their disappointment and despair, and when we consider how much they believe that they were promised and how little they believe has been delivered, we realise how serious the situation is.
	Yesterday, a constituent from Withernsea wrote to me to say that their family have a modest family car, but they are selling it because they can no longer afford to run it. Withernsea is a town and has a relatively large number of services, but residents are dependent on other services elsewhere. Other constituents of mine, who do not live in a town but in one of the many villages across the constituency are in a similar position financially but cannot possibly do without a car because of the dearth of public transport and the difficulties that that causes.
	When my constituents speak to me at the street surgery, they are pleased to have that opportunity because it at least allows them to feel a connection. Someone from Withernsea, on a very low income, sees certain services withdrawn and needs to feel a connection. They need to feel that there is some way in which they can influence those in power so that they can cause change. When they hear a debate such as this about the cost of living and when, as lifelong Labour supporters, they recall that the Labour party was founded and led by people such as Keir Hardie precisely in order to represent the working poorthe working class, as it traditionally wasthey see, instead, a Labour party that has lost its sense of mission. Hundreds of Membersall of us hereare on very high wages compared with my constituents, with high expenses support, too. When those people discover that Labour Members no longer judge participation in such important debates as relevant, their disappointment is compounded further. When they hear speeches such as the one given by the hon. Member for Edinburgh, South (Nigel Griffiths), who we all know is extremely close to the Prime Minister, and hear his master's voice speaking with such a level of complacency while the traditional supporters of the Labour Government are suffering and struggling, not least in rural areas, their sense of disappointment is palpable.
	I wish I could feel triumph as I sense the political ground shifting as people come over to support the Conservatives, but Labour Members like to say that that shift is not so much a positive endorsement of the Conservatives, and they have a point. In fact, people are turning to us because they want to believe that there is a positive alternative and my right hon. Friend the Member for Witney (Mr. Cameron) is offering one.
	Most of all, it is the failure of the Labour party and its representatives to stay connected with its original core support that is the problem. A former Labour leader and Prime Minister said, I think, that the party is a mission or it is nothingI might be misquoting him, but that was certainly his point. Where is the sense of mission on the Government Benches? Where is the commitment to do something about those with least in our society?
	What has happened to the poverty rate over the past three years? It has increased each year for three years. What has happened to child poverty for the past three years? It has increased. What has happened to fuel poverty? It has increased. Where are the Labour voices speaking up on behalf of the people who they were traditionally here to represent? I could not believe that a spokesman for this failing Government could mention Nye Bevanhe would be spinning in his grave to think that a Labour Government could so let down those with least in our society.
	I shall not be able to match the eloquence and power of the speech from my hon. and learned Friend the Member for Torridge and West Devon (Mr. Cox). His was one of the best speeches that I have heard in this House for some time. He has some rhetorical giftsperhaps that is a professional requirementbut his speech's power mostly stems from the fact that, like me, he speaks to people who are living the reality of this Government's policies. He is reflecting their passion when he stands up and demands a response or some sense of feeling from Ministers.
	I apologise, Mr. Deputy Speaker, for the word that I am about to use, but the Minister in question used it in his blog. He asked, Why is everyone so bloody miserable? That from a Minister who is driven around in a chauffeur-driven Prius

Jeremy Browne: It does not get any better than that!

Graham Stuart: The hon. Gentleman may think that a laughing matter, but my constituents can no longer afford cars. They see their bus fares going up and their services being cut.

Mark Hoban: The argument at the centre of the debate is that we are about to face a period of prolonged inflation above the 3 per cent. target, as the Governor of the Bank of England made clear last week. As a consequence, families will find it increasingly difficult to make ends meet.
	However, at the very time when families are under such pressure, the Government, because of their mismanagement of public finances, can do little to lift the burden. That is why people are not turning to the Government for a solution to their problems, but are asking how they can get higher pay increases. The pressure for higher pay would be less if the Government were in a position to help.
	Before I elaborate on that, I shall comment on some of the speeches in the debate. The Chief Secretary to the Treasury offered a prime example of the Government's approach to the economy. They want to take the credit in the good times and blame someone else in the badan approach evident time and again in her speech. She talked about global pressures, but did not mention the deterioration in the exchange rate over the course of the past year, or the impact that that has had on inflation.
	In his letter to the Chancellor last week, the Governor of the Bank of England said:
	Price inflation of imported goods rose to its highest since 1995, in part reflecting the substantial depreciation of sterling...A key factor...has been sterling's 12 per cent. depreciation since July 2007.
	The markets have spoken on this Government's economic policies and found them wanting.
	The hon. Member for Twickenham (Dr. Cable) tried to make a point by misreading our motion. When they came to office in 1997, the Government were prudent in their management of the public finances and followed our spending plans, and we have made it clear that they would be in a much better position to help families in difficult times now if they had continued to do so.
	Only two Labour Back Benchers spoke in the debate, and the first, the hon. Member for Edinburgh, South (Nigel Griffiths), made a remarkably arrogant speech. He gave the game away when he responded to an intervention by saying that people will realise how marvellous this Government are when the scales fall from their eyes. There we have itit is the people's fault that the Government have their lowest poll ratings in 11 years, and their fault that they cannot understand what the Government are doing. But I credit the people with more sense than that: they have seen through the Government, and they have worked out that the Government have failed the people of this country.
	My right hon. Friend the Member for Wokingham (Mr. Redwood) identified opportunities that the Government had had to make decisions in the long-term interests of the country. He said that they could have made some significant choices that would have reduced our dependence on oil. When the Economic Secretary responds to the debate, I hope that she will admit that the Government's policy for tackling inflation over the next couple of years is to cause a real decline in people's living standards. The Governor of the Bank of England was brave enough to admit that, although no one on the Treasury Benches, including the Chief Secretary, has been able to accept it. Perhaps the Economic Secretary will be refreshingly candid when she concludes the debate.
	The hon. Member for Northampton, North (Ms Keeble) asked the Government to take more action to tackle problems of fuel poverty and the cost of fuel. When she tries to explain the Government's actions to the electorate, her problem will be that the mismanagement of the public finances over the past 11 years has left little money in the coffers that could be used to help her constituents and to lift the burden from them.
	My hon. and learned Friend the Member for Torridge and West Devon (Mr. Cox), and my hon. Friends the Members for Shrewsbury and Atcham (Daniel Kawczynski) and for Beverley and Holderness (Mr. Stuart) spoke eloquently about the problems for people in rural communities who face an increased cost of living. My hon. Friend the Member for Cities of London and Westminster (Mr. Field) highlighted the impact that income tax rates will have on people on low pay. The reality is that it was the protest against the scrapping of the 10p rate that led to the Government having to increase personal allowances for one year only. However, even that will not compensate the lowest paid for the losses that they have suffered as a result of the abolition of the 10p rate.
	In his Mansion house speech last week, the Governor of the Bank of England was frank in his assessment of the times that we are in when he said:
	This year our real take-home pay will rise at a slower pace than national productivity. Rising fuel, gas, electricity and food prices mean that average real take-home pay will stagnate this year. It will not be an easy time, and I know that some families will find it particularly difficult.
	He is right: families will find it particularly difficult. In difficult times, families instinctively turn to the Government for help and support but we know that, because this Government failed to prepare for economic uncertainty, they have little to offer. As the OECD pointed out, the Government's loose fiscal policy during the good times means that they have little room for manoeuvre in the bad times. International league tables show that this country has one of the largest budget deficits among all the industrialised nations. Other Governments' more prudent management of public finances means that they are able to cut taxes on families and businesses, but what have this Government done? They have put up taxes on cars, small businesses and successful entrepreneurs.
	It is a sign that the Government have run out of road at home that they are forced to place their trust in global initiatives and summits in the hope that there might be some relief. The Government's amendment reflects that, and shows that they hope that OPEC and the Doha trade round will come to their rescue.
	Only in their second terms do Prime Ministers usually find international gatherings more attractive than domestic politics. However, this Prime Minister has not reached even his first anniversary of coming to office before deciding that he will receive a warmer welcome in Brussels and Jeddah than at home.
	We believe that the long-term solution to the Government's mismanagement of the public finances is to share the proceeds of growth. In that way, although public spending increases in real terms, its growth will be less than the rate of growth for the economy as a whole. That will create the resources to reduce borrowing and help support families and businesses.
	That was the approach that the Prime Minister rejected when he was Chancellor, but he has been forced through necessity to adopt it in the current spending round. His problems with managing the public finances mean that families facing a squeeze on their living standards also know that they cannot expect the Government to help them because the Government failed to prepare for difficult times.
	The Government did not fix the roof when the sun was shining, and families are now faced with a challenge. The Government are saying, We can't help you because we can't afford to help you, so do people sit tight and wait for things to get better or do they push for higher wages?
	People are economising and finding it difficult to make ends meet, and we have heard examples of that in the debate. I think that there will be pressure for higher wages, and the risk is always that higher wage rates will entrench inflation in the economy. That would put further pressure on the Bank of England to respond with higher interest rates.
	The Government call for wage restraint for the public and private sectors, but their biggest challenge lies with the heavily unionised public sector. The Government are in hock to their paymasters, and how they handle the public sector trade unions will be their big test. Yesterday, local government workers rejected a 2.45 per cent. pay increase. The general secretary of their union, Dave Prentis, said his members were
	fed up and angry that they are expected to accept pay cut after pay cut while bread and butter prices go through the roof...Most of them are low-paid workers, who are hit hardest by food and fuel price hikes.
	Over the coming months, the Government will come under increasing pressure from their union paymasters to soften their position on paybut will they be tough enough to withstand the pressure from the unions, when they know that Labour Party funding depends upon trade union contributions?
	There can be no guarantee that this Prime Minister will stand firm. Anatole Kaletsky said recently that the
	biggest worry has been Mr. Brown's surprising combination of weakness and short-termism since he became Prime Minister. If he responds to minor hiccups such as the 10p tax row by giving away 2.7 billion, one wonders how he would react to a genuine challenge to his authority on the scale of the Winter of Discontent?
	Will the Prime Minister find the courage to stand up and face down the trade union bosses, or will he yet again show how weak he is by caving in to their pressure?
	The Government have failed to provide for a rainy day, and that is why they now have to increase taxes on families and businesses rather than help them by reducing the burden of taxes. Because of that pressure, families will look for greater pay increases, and that is where the danger lies for the economy. That danger could have been avoided if the Government had prepared the economy and public finances for the challenging times, rather than mismanaged the public finances, putting the future of the economy and of families at risk.

Kitty Ussher: This debate is about an important subject and I have enjoyed listening to the speeches of the hon. Members who have contributed. As we have heard, people across the country are concerned about the cost of living. They feel the effects of rising food and fuel prices across the world. The doubling of world oil prices has led to rising bills at the petrol pumps as well as to increases in gas and electricity bills. At the same time, the price of basic foods has gone up.
	However, as we look at that combination of facts, it is important for us to remember that since 1997 Britain has benefited from relatively low inflation, which has been on average half what it was in the previous 20 years. Even now, inflation is far lower than in the past. It rose above 20 per cent. in the 1980s and above 10 per cent. in the 1990s. Families are rightly [Interruption.]

Mr. Deputy Speaker: Order. The House must allow the Minister to respond to the points that have been made.

Kitty Ussher: They obviously do not want to hear the facts of the matter.

Philip Hammond: Will the hon. Lady give way?

Kitty Ussher: I shall give way in due course, but in the time available I wish to answer the specific points that have been raised.
	Families will be concerned by the increases at supermarkets and petrol stations and in their energy bills. To address those concerns, we have to tackle the root causes of the higher prices. Those causes are international. We are not alone in saying that; the Governor of the Bank of England also says it. He said that 1.1 per cent. of the 1.2 per cent. increase in inflation since the end of last year has been due to international circumstances. We have to work with our international partners to find the right response and we must respond to the ongoing impact of the global credit squeeze, which is contributing to the challenging economic times that we face.
	As I listened to the opening speech from the hon. Member for Runnymede and Weybridge (Mr. Hammond), I found it interesting that he did not at any point indicate that the problem was international or that the solution lay at an international level. At no point did he urge us to work through OPEC to raise oil production; neither did he urge us to work with our EU partners to liberate the global food market. I can only presume that when his party was in power, it had an empty-seat policy at EU level; its record gives it no credibility on the international stage.
	It is important to work with our international partners to address what is an international issue; at the same time, domestically, we must provide families with support when they need it. That is what we are doing, through the increases in personal allowances this year, the additional payments that we are making through the winter fuel allowance and the delay in the fuel duty increase that was due this April.
	I turn to some of the specific points raised in the debate. Disparaging remarks have been made about the speech made by my hon. Friend the Member for Edinburgh, South (Nigel Griffiths). I enjoyed his excellent and factual contribution. He pointed out that the roofs of the schools, hospitals and railway stations have been fixed under this Government. The investment in public servicesextra police, doctors and nurseshas been widely welcomed. In the past 10 years, real pay has gone up by more than 20 per cent. in each of those sectors, and we are rightly proud of that.
	By contrast, the right hon. Member for Wokingham (Mr. Redwood) said that we should have made earlier decisions about nuclear power. Whatlike his party, which deliberately said that it would defer the decision, despite the long lead time required to invest in this low-carbon technology? He also said that we should try to reform the common agricultural policy, but in many ways we have succeeded in doing that.

Graham Stuart: What?

Kitty Ussher: We have, with the shift from pillar one to pillar two of the common agricultural policy, and we continue to make our case. The party of the right hon. Member for Wokingham, would not even engage on the European stage; if it were still in power, we would not have achieved that progress.
	In an intervention on the right hon. Gentleman, the hon. Member for Taunton (Mr. Browne) pointed out that the Conservative partyfar from anticipating what it now says was the need for a different economic policy during what the Governor calls the non-inflationary consistent expansion, or NICE, yearswent into the last two elections explaining how it would spend more while cutting taxes. It would, apparently, have surfed the wave of economic prosperityin a way that would have created even more of a problem, given the black hole in its finances.
	That gets to the core of today's debate. On the one hand, the Conservative party says that it will match our spending; at the same time, it tries to imply that it will return money to the British people by sharing the proceeds of growth. I do not know where that extra money would come from. I can only presume that the Conservatives are hoping that the black hole in their finances will suddenly spew out pound coins for them to distribute liberally throughout the economy.
	That all relates to what we have seen in this Opposition day debate. The Conservatives are trying to imply, in a salesman-like way, that there is some huge problem with the Government's record on the cost of living. At the same time, their own words in their own research document show that the standard of living has risen under the Government. Since 2001-02, pensioner couples have been 30 a week better off in real terms under Labour, say the Conservatives; single women pensioners have been 21 a week better off under Labour, say the Conservatives; and couples of whom one partner works full time and one works part time are 14 a week better off under Labour, say the Conservatives. The Conservatives say that lone parents are 12 a week better off and that on average everybody is 9 a week better off because of our policies. I will take no lessons from the Conservative party about the cost of living under Labour.
	As always, my hon. Friend the Member for Northampton, North (Ms Keeble) made a helpful and well informed speech. In response to an intervention from the hon. Member for Beverley and Holderness (Mr. Stuart), she pointed out that real wages have risen under the Government. Using Institute for Fiscal Studies data, the hon. Gentleman seemed to try to imply that incomes had fallen. I have read that report, which is extremely credible. However, the authors admit that the specific figure that he cited was within the scope of the margin of error, so it was not appropriate for the hon. Gentleman to use.
	Perhaps we should look at the report resulting from the survey of households of below-average incomes. It shows that the incomes of the poorest and richest 20 per cent. of households have risen by 2 per cent. a year since 1997 and that real household disposable incomes across the board have risen by 27 per cent. Let us put it all into context: from the 1980s until the mid-1990s, the real incomes of the poorest 20 per cent. of households rose by less than 1 per cent. a year, while those of the richest 20 per cent. rose by about 2.5 per cent. a year. It is absolutely clear that the tax credit, benefit and welfare to work policies of the Government have arrested the relative increase in income disparities that happened under Conservative Governments.
	My hon. Friend the Member for Northampton, North urged me to continue to focus on the needs of the working poor in our future policies, and we will of course always do that. On fuel poverty, I should point out that we have got the six major energy suppliers to increase their spending on the most vulnerable by 225 million. The Warm Front programme has been rolled out under the Government and it has had a huge effect, particularly in constituencies such as mine, which have a high proportion of old terraced housing. Driving costs are 16 per cent. lower under this Government than they were under the Conservative Government.  [ Interruption. ] I do not know why hon. Members are muttering among themselves. I can only presume that it is because they do not want to listen to the facts and are attempting, by spin and innuendo, to imply to the country that we have not made the enormous inroads that we have, as everybody knows from looking at their own standards of living compared with 10 years ago.
	We continue to work closely with the Council of Mortgage Lenders to find out what more can be done to reduce the burden on people who are having difficulties with their mortgage costs.
	We face some genuine issues that need to be addressed internationally as well as through domestic policy, and we are doing that. Today's debate has shown that Conservative Members have absolutely no ideas and no policies.

Question put, That the original words stand part of the Question:
	 The House divided: Ayes 189, Noes 297.

Question accordingly negatived.
	 Question, That the proposed words be there added,  put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.
	Mr. Deputy Speaker  forthwith declared the main Question, as amended, to be agreed to.
	 Resolved,
	That this House notes the significant increases in world prices, with the oil price rising 80 per cent. and food prices up 60 per cent. in the year to May 2008; notes that the Governor of the Bank of England's letter to the Chancellor dated 16th June 2008 said that 1.1 per cent. of the 1.2 per cent. increase in inflation over recent months was due to world food and energy prices, and that the Government was right to tackle the rises with action on an international level, including urgently looking for a successful conclusion to the Doha round of negotiations in the World Trade Organisation and examining the impact of biofuels on food production; supports the Government's global leadership on these issues; recognises the pressure that these increases in world prices put on family budgets; further notes the measures that the Government will continue to take to support families and individuals, including pensioners and businesses, throughout the UK, including through extra tax credits, increased tax allowances, winter fuel payments and increases in child benefit; further notes that the most important support for working families is a strong and stable economy; and supports the Government's actions that have delivered unemployment, inflation and interest rates all at historically low levels, helping millions of families into stable home-ownership and sustainable employment.

Opposition Day
	  
	[15th Allotted Day]

NHS (60th Anniversary)

Mr. Deputy Speaker: I must remind the House that Mr. Speaker has selected the amendment standing in the name of the Prime Minister.

Andrew Lansley: I beg to move,
	That this House celebrates 60 years of the NHS; recognises the support from all political parties for the NHS during that time; is grateful to NHS staff, past and present, who are the key to its success; commends their commitment and expertise in delivering patient care in often difficult circumstances; acknowledges the unique contribution of volunteers and charitable organisations; is committed to providing the NHS with the funding it needs to deliver European standards of healthcare to all; and recognises an opportunity in future to make the NHS more patient-centred by focusing on outcomes.
	On Saturday week, it will be the 60th anniversary of the national health service, and my right hon. Friends and I felt that the House should have the opportunity, in anticipation of that day, to record our appreciation of all that the NHS has achieved and all that it has meant to the people of this country over the course of those 60 years. We do so this evening entirely in the spirit

Jim Devine: Will the hon. Gentleman give way?

Andrew Lansley: When I have made a little progress.
	We do so entirely in the spirit in which the national health service was created. I shall let the House have a quotation:
	The discoveries of healing science must be the inheritance of all. That is clear. Disease must be attacked, whether it occurs in the poorest or the richest man or woman simply on the ground that it is the enemy; and it must be attacked just in the same way as the fire brigade will give its full assistance to the humblest cottage as readily as to the most important mansion... Our policy is to create a national health service in order to ensure that everybody in the country, irrespective of means, age, sex, or occupation, shall have equal opportunities to benefit from the best and most up-to-date medical and allied services available.
	The Prime Minister of the day, Winston Churchill, said that on 2 March 1944, anticipating the establishment of a national health service.
	In a spirit of consensus, I will acknowledge that the NHS was inspired by the work of a Liberal, William Beveridge, designed by a Conservative, Henry Willink, and implemented by a socialist, Aneurin Bevan. [Hon. Members: Oh!] I was talking to a nurse; my right hon. Friend the Member for Witney (Mr. Cameron) and I have met a number of[ Interruption.] Is the hon. Member for Livingston (Mr. Devine) seeking to intervene?

Jim Devine: I have the record of Second Reading of the Bill that introduced the national health service, in which the hon. Gentleman's predecessor, the then shadow Health Minister, started by saying:
	The right hon. Gentleman the Minister of Health has received an ovation from the Benches behind him for a speech as eloquent, as unconvincing, and as disingenuous as any I have ever heard from him.[ Official Report, 30 April 1946; Vol. 422, c. 63.]
	When did the Conservative party start supporting the NHS?

Andrew Lansley: Considering the occasion, the purpose of the debate, the nature of the motion that we have tabled and the way in which I am introducing it, that was a wholly inappropriate response. As far as I could tell from listening to it, it was probably inaccurate, but it was difficult to say.
	In the 60 years since the establishment of the national health service, it has been under the stewardship of Conservative and Labour GovernmentsConservative Governments for 35 years and Labour Governments for 25 years. In that time, the NHS, for all its vicissitudes and the ups and downs that it has suffered, has none the less exhibited continuous gain, from the point of view of the people of this country. It has benefited us individually and collectively and remains part of the glue that holds society together. From the point of social solidarity and a sense of security in this country, it is immensely important to people.
	Conservative Members knowas do all hon. Membershow much we rely on the NHS. I suspect that many of us, from all parties, have occasion to visit other countriesI am thinking especially of Americawhere the experience of people visiting their health services is too often of worrying about whether they can pay for their care, what the circumstances will be if they become chronically ill and whether, if they visit an accident and emergency department, they might first be asked for their insurance policy or visa number. We do not have those experiences in this country. We have a sense of equity and an understanding that, as part of our social solidarity, we are collectively committed, through taxation, to providing a comprehensive health care service, free at the point of delivery and based on people's need, not their ability to pay. Those principles are unchanging, even though policies may change or be debated. I do not believe that we disagree about the principles.

Graham Stuart: I congratulate my hon. Friend on the tone with which he has begun the debate, in which hon. Members of all parties will celebrate the foundation of the national health service. There have been huge increases in spending on the NHS, for which the Labour party deserves some credit, but a focus on outcomes rather than false targets will end the distortion of clinical priorities and of the value for money and excellent health care to which the expenditure should lead.

Andrew Lansley: I am grateful for that intervention and it will not surprise my hon. Friend to know that I feel strongly that the NHS needs to become much more focused on outcomes for patients. That policy does not derive from our thinking alone, but is the product of speaking to literally thousands of people in the national health service. They say that they want to care for the patient and determine their actions on the basis of the patient's need in a framework where policy is geared to that. Unfortunately, although the Government have been talking about outcomes since my right hon. Friend the Member for Witney and I started to make it clear that we would move in that direction, they are not designing health outcomes into the policy of the NHS. The policy, as dictated by the Government through national targets, is still geared towards processes and targets rather than health outcomes for patients. A change of direction is vital.

Chris Ruane: The hon. Gentleman started with a brief synopsis of the Conservative party's position in the 1940s. Will he remind the House of how the Conservative party voted in 1948? Did it vote for or against establishing the national health service? It is a simple question.

Andrew Lansley: I have not looked back[Hon. Members: Oh!] However, my recollection is that Conservative Members at the time, in opposition, took a view about the specific proposals that the Labour Government presented and objected to aspects of them. Labour Members appear to believe that the British Medical Association's difficulties at the time were a measure of its opposition to the NHS. It is no more true to say that the Conservative party since 1948 or today opposes the NHS than it is to say that the BMA opposes it. Neither statement is true and it is absurd to claim either.

Jeremy Browne: I am grateful to the hon. Gentleman for giving way because I want to make a helpful intervention. In these straitened economic times, will he reaffirm his personal commitment to increasing NHS spending by 28 billion a year over and above the current Government figure?

Andrew Lansley: The hon. Gentleman must not believe everything that he reads in the newspapers. I made no such commitment. Our commitments are clear: we are committed to the same increases in NHS spending up to 2010-11 as those in the Government's spending plan. Beyond 2010-11, my colleagues are committed to further real-terms increases in NHS spending.

Greg Knight: Is my hon. Friend aware that, although most people recognise the anniversary, it is not being celebrated everywhere? For example, in Bridlington in my constituency, there is genuine concern that a relatively new hospital, which a Conservative Government built, maintained and sustained, is under threat from the Labour Government, with services being cut.

Andrew Lansley: Labour Members should listen to my right hon. Friend because attachment to the NHS is often expressed through support for one's local health service. It should be no surprise that, as I know from my visit to my right hon. Friend's constituency, many thousands of local people have signed a petition to maintain services at their local hospital. Instead of carping, Labour Members would be well advised to acknowledge that that is true not only in Bridlington but in many places throughout the country.
	People are signing petitions not in contravention of medical evidence, but with clinicians' support and on the basis of evidence for the desirability of maintaining care closer to home. Labour Ministers have adopted that policy, which my former right hon. Friend, Virginia Bottomley, began. She started the process of providing care closer to home, and that care is being lost too often under a Labour Government.

Several hon. Members: rose

Andrew Lansley: I want to make progress and I do not want to take much time because I want as many Members as possible to have a chance to express their views about the NHS. It is not an occasion for me to make manyor, indeed, anyparty political points or to talk about policy in great detail.
	However, when one considers the current position in the NHS, we should take account of some things from the past. A couple of years ago, I was at Papworth hospital, which was celebrating the 25th anniversary of the first heart transplant. I was surprised to hear Sir Terence English, who carried out that transplant, say that the 1980s was a golden age in the NHS. That is not a phrase that I normally hear applied to the 1980s, so I asked him what he meant by it. He replied that, in those days, if he could convince the board of governors at Papworth hospital that he should innovate through undertaking something groundbreaking, there was nothing to stop him. We need to consider that carefully. The Conservative party is geared towards health outcomes because the structures of targets and micro-management in the NHS have made many NHS staff believe that they are no longer in a position to innovate or have the freedom to deliver high quality care in the way they should.

Clive Efford: Will the hon. Gentleman give way?

Andrew Lansley: No, I am making progress and I want other hon. Members to be able to speak.
	Hon. Members of all parties should ensure that there are opportunities for innovation.
	As we understand from Derek Wanless's reports and his revisions to them, there are substantial risks to the future of the NHS, not least those that arise from demographic change, the impact of new technologies and the costs associated with implementing them, and rising expectations and demand. However, central among those risks are the impacts of public health demands, if we are unable to achieve what he describes as a fully engaged scenario, whereby the public understand the health implications, including obesity and sexually transmitted infections, of behaviour such as alcohol abuse, substance misuse and the like. Unless the public recognise that, it will be very difficult for the NHS to cope with the disease consequences that will arise.
	When Ministers publish the review next week, I hope that they will make it clear that it is outrageous that in London, for example, as Lord Darzi set out in A Framework for Action, there is an inverse relationship between the relative deprivation of primary care trusts and the amount spent on preventive health care. Indeed, we have set out clearly how our public health infrastructure should be geared to that, and how we should have separate public health spending. Right across the country, there is no positive relationship; indeed, the average spend per head in primary care trusts on preventive health care spending is just 20, from an average allocation to PCTs of well over 1,000 per head. That is the second lesson.
	The third lesson that we must learn is about giving the NHS organisational stability. My right hon. Friend the Leader of the Opposition happily said that, and the Secretary of State repeated what he said when he took officethat there should be no further major organisational upheavals. I will not dwell on all the things that have happened, but even now the NHS does not know whether it is working to the NHS plan from 2000, to Keeping the NHS local from 2004, to Commissioning a patient-led NHS from 2005, to Your health, your care, your say from 2006 or to whatever is contained in the document to be published next week.
	There is no thread of consistency and stability in either the structures or the policy being pursued in the NHS. One of the first things that many people working in the service would say to us, as we collectively discuss the NHS after 60 years, is that they will be able to deliver so much more in the future if they are given the stability of a framework in which to do so and the freedom to respond to the needs of patients.

Philip Hollobone: Local people in Kettering are rightly proud of their district general hospital, which this year celebrates the 111th year since its foundation. Although they are positive about the NHS in respect of the local hospital, they are negative about it in respect of NHS dentistry. Local people have never had such limited access to an NHS dentist as they do now.

Andrew Lansley: I am grateful to my hon. Friend, who makes an important point. If my memory serves, over the past year we have seen a reduction of about 1 million in the number of people accessing NHS dentistry. We must recognise that the experience of dentistry that many people throughout the country have is genuinely one of a two-tier system. There are people in some areas who can access NHS dentistry or receive it free, because there are still contracts and dentists available, yet in other places it is simply not available or people pay so much that, frankly, they might as well be in the private sector, because of the costs that they have to meet.
	My hon. Friend makes an important point, and we need to be realistic. This is a debate not just to say thank you, although that is an important part of it, but to listen to the staff of the NHS. Last week, the Government published the annual survey of NHS staff, What Matters to Staff in the NHS. There was much in it about NHS staff feeling positive about their hospitals or surgeries, and they were very supportive of what the NHS stands for.
	However, staff were asked, by Ipsos MORI on behalf of the Government, whether they would praise the NHS as it currently stands. Unhappily, those figures were not as good. Forty-three per cent. of staff overall said that they would speak critically of the NHS as it now stands and only 27 per cent. said that they would speak highly of the NHS as it now stands. That is very depressing. Any organisationpublic, private or whateverin which more staff would, unprompted, speak critically of that organisation as it stands today than would spontaneously speak highly of it has serious problems with staff morale and motivation, which needs to be changed.

Alan Johnson: Staff views are very important. NHS staff were concerned about changes to their normal pension age. I negotiated an agreement whereby all NHS staff in post at the time would continue to have a normal pension age of 60. The hon. Member for Tatton (Mr. Osborne), the shadow Chancellor, said that that agreement should be reviewed. Will the hon. Gentleman confirm that NHS staff, about whom he is rightly concerned, can rest assured that the Conservative party will not reopen that deal and that all staff in the NHS will continue to have a normal pension of 60, if those were the terms on which they were recruited?

Andrew Lansley: Yes, I did not have the opportunity, I am afraid, to listen to my hon. Friend on Newsnight, but I understand that he made it clear subsequently that he had not been correctly quoted. I thought that the Secretary of State was rising to respondI hoped positivelyto the fact that 43 per cent. of NHS staff, including 54 per cent. of medical and dental staff and 49 per cent. of junior managers, said that they would speak critically of the NHS as it is now. That needs to change, and if that is not critically important to the Secretary of State, it ought to be.
	People in the NHS listening to our debate this evening would say, Don't just say thank you to us or express appreciation for what has been achieved. We know that the public support us, but at the same time they know that we are not allowed to achieve what we should achieve, and that although we've seen a doubling of resources in the NHS in the last 10 years, this hasn't reached the front line and it isn't delivering the patient gain that it should. From our point of view, not only do we need organisational stability, empowerment of professionals and freedom to deliver for patients, but we are prepared to be held to account for the outcomes that we achieve and held to account by patients for the services that we provide. Patients should be able to access choice and control over their health care and, to an extent, those with long-term conditions should even, where possible, be able to manage personalised budgets.

Joan Ryan: It is important to talk to staff, and I have talked to the staff at my local hospital. They are users of that service, too, and they have said to me that they are not willing to wait more than four hours in A and E. They do not want to wait more than 18 months for operations and are pleased about everybody getting 18 weeks, end to end. What does the hon. Gentleman think is the difference between the target and the outcome? If the target is that everybody gets their operation and gets better, the outcome is better health for everybody. It is misleading to mix up targets and outcomes.

Andrew Lansley: Let me say two things to the right hon. Lady. First, I do not think that she has talked to many NHS staff, if that is the view that she reaches.

Joan Ryan: On a point of order, Mr. Deputy Speaker. I do not understand the basis on which the hon. Gentleman can contradict me when I say that I have spoken to NHS staff.

Mr. Deputy Speaker: Order. If that had not been in order, I would not have let the hon. Gentleman say it. These are matters for debate, not matters for the Chair.

Andrew Lansley: Let me explain two things to the hon. Lady. First, many clinicians to whom I have spoken over many years, as well as their representative organisations, have made it clear that the impact of a waiting time target is less about delivering reductions in waiting times than it is about distorting clinical practice and the clinical judgments that have to be made. Waiting time targets can thereby have a damaging overall impact on health outcomes.
	Clinicians want to focus on outcomes and be held to account for some of the performance measures that go into delivering high-quality care for patients. There is no doubt that clinicians know that their local hospital should be responsible for publishing referral-to-treatment times and that patients and commissioners should hold them to account for that. That is performance management; it is part of the contract and nobody is proposing that we get rid of it. However, the hon. Lady must recognise the truth about imposing a national, one-size-fits-all, 18-week referral-to-treatment target. Almost every clinician to whom I have spoken says, This is nonsense. There is no clinical evidence for this and it distorts. Indeed, we can see that happening already, with hospitals having to pay well over the tariff to access private sector providers and deliver the target.
	Another thing that I would like to say to the hon. Lady is that the staff at her local hospital, Chase Farm, are saying, Don't take away our maternity services and our A and E services. The people of Enfield care about services at Chase Farm, and I wish that she had got up to tell the House about that, instead of making a party political point.

Clive Efford: Will the hon. Gentleman give way?

Andrew Lansley: No.
	Let us be very clear about this. International benchmarking

Barry Gardiner: Will the hon. Gentleman give way?

Andrew Lansley: No.
	International benchmarking is absolutely critical. Let us look at a simple example. The Government rightly say that, over the past decade, we have seen reductions in premature mortality from cardiovascular disease and stroke. However, they never go on to say that that has been true not for 10 years but for 20 years. They never go on to say that, when we compare our data with those of other countries, we see that we have not narrowed the gap. They do not go on to say that studies suggest that we have the worst outcomes for stroke among the European countries. They do not go on to say that there are routine procedures in other countries for stroke services and heart care servicesfor people having a heart attackunder which people are treated as an emergency when they have a stroke or when they are taken for primary angioplasty when they have a heart attack. Those services have routinely been offered for years in those other countries but they are not being offered here.
	International comparison is essential in this regard. How can we know how well the NHS is performing unless we look at countries with equally developed health economies to see how well they are doing by comparison?

Stephen Dorrell: Is not the situation actually worse than my hon. Friend describes? Some years ago, there were two gaps. We spent less per head on health care than our European comparator countries, and we had worse health outcomes. Now, our spending is broadly in line with our European comparator countries, but we have not eliminated the gap on health outcomes. That is the core challenge, and the Government have failed to deliver on it.

Andrew Lansley: I am afraid that it is, and this takes us back to one of the central issues that most depresses people who work in the national health service, and those whom they look after. They want to see those resources, and they want to use them productively. Unfortunately, however, the nature of the system means that when spending was rising fastest, productivity in the NHS was falling by 2.5 per cent. a year, according to the Office for National Statistics. In those circumstances, they cannot deliver the quality of health care that they should.
	Last year, the Government were fond of quoting the Commonwealth Fund, but I am afraid that that study presents an unhappy picture of an international comparison that does not even include some of the most positive comparators, such as France. The Commonwealth Fund, from New York, which Ministers like to quote, states that the UK health care system is the worst for waiting times, for mortality rates, for hospital-acquired infections, for preventive care such as breast cancer screening, for caring for those with long-term conditions and for GP access out of hours. So, precisely[ Interruption.] Hon. Members laugh, but this is not a matter for amusement. The Commonwealth Fund is quoted by Ministers, and I have just quoted it as well. They should recognise this. We should look at outcomes, at the overall benefit for patients and at international comparisons. The Governmentand any future Governmentmust focus on overall outcomes for patients and not on trying to micro-manage the way in which they are achieved. We should focus on what we are trying to achieve, and we should be rigorous, challenging and ambitious about that, but we should not try to dictate how it is done.

Anne Moffat: The hon. Gentleman was talking about what NHS staff actually thought. Does he rememberas I do from when I worked in the NHSthat this Government are not frightened to ask the staff what they think about the health service and about what measures can be taken to improve it? When the Conservative Government were in power, if whistleblowers told the public what was going on in the national health service, they were sacked for telling the truth. Does the hon. Gentleman think that that is a good record?

Andrew Lansley: I am sorry that the hon. Lady thinks that that was true in the past, and that it is not true today. I am afraid that I have met many people who still feel that the culture in the NHS is such that they cannot speak out openly about what is happening. That should not be true, but unfortunately it still is.

Clive Efford: Will the hon. Gentleman give way?

Andrew Lansley: No, I am going to finish my speech in a moment. I want everyone to have a chance to speak.
	The national health service is something we can applaud and something to which we attach enormous importance locally. In my own constituency, the Addenbrooke's and Papworth hospitals are excellent examples of innovation and high quality care, and we attach enormous importance to them. But the NHS knows, and we know, that the route for the future is not just about things as they are. It is about achieving a stable organisational framework for the NHS that will allow real dynamism for reform and change. Under the twin levers of patient choice and a competitive environment among health care providers, information based on health outcomes, rather than on micro-management, will deliver the framework within which those levers can work most effectively.
	Internationally, we can see that we have a treasure in the NHS. When I go to America or, as I did recently, to the Netherlands, I see that people are seeking to achieve a structure that will provide universal coverage, or a maximum risk pool, as they put it. They want to achieve the combination of equity and efficiency that everyone is looking for in health care. The scale of spending on health care in many of those countries is similar to our own or even higher. In America, for example, the scale of public spending on health care as a proportion of gross domestic product is almost exactly the same as it is in this country, but there is an additional 7 per cent. of gross domestic product on top of that in private contributions. That is not a situation that anyone could contemplate. The inefficiencies involved are not to be contemplated.
	In the national health service, which is funded through general taxation, we have a vehicle that is highly efficient at raising resources for health care and highly equitable in regard to the potential distribution of, and access to, that health care. Unfortunately, over recent years in particular, it has become bureaucratic and monolithic. It does not exhibit the characteristics towards which all those other health care systems are moving in regard to exposure to efficiency. That exposure to efficiency, through choice and competition, is essential for the future, and I believe that NHS staff are happy to contemplate that. They are prepared for it, as long as the competition is fair and they are judged on genuine outcomes, and as long as they are given the opportunity to do the best for patients in a framework that continues to be supportive and true to the principles of the national health service.
	In supporting the motion this evening in a non-partisan fashion[ Interruption.] It is entirely non-partisan. I hope that my colleagues and I will make it clear that its purpose is to give hon. Members on both sides of the House the opportunity to express differing views on the policy direction of the NHS, as well as a clear and unanimous commitment to its principles, its values and its future.

Alan Johnson: I beg to move, To leave out from all; to the end of the Question, and to add instead thereof:
	recognises an opportunity to make the NHS more patient-centred by focussing on outcomes; further recognises the defining contribution the NHS has made to the health and wellbeing of the nation since 1948; acknowledges that the principles upon which the NHS was established, funded by general taxation and free at the point of delivery, are immutable; accepts that target reductions in waiting times have significantly improved services to patients; and looks forward to the next 60 years of the NHS characterised by world-class quality healthcare as well as greater personalisation, individual choice and easier access to services..
	There is nothing in the Opposition's motion that we find objectionable. There is one minor quibble, which I will come to in a secondand there is a very major quibble sitting next to the hon. Member for South Cambridgeshire (Mr. Lansley); I will deal with the minor quibble later. The claim in the motion that the Conservatives recognise
	the support from all political parties for the NHS
	crept in at the last minute. It was not there yesterdaybut I will even let that pass. I might come back to it later.
	We are genuinely pleased that the Opposition have dedicated some of their time to discussing the important occasion of the 60th anniversarythe diamond anniversary, indeedof the national health service. We should not forget the many and varied ways in which it has improved the lives of individuals in this country, and improved the nation as a whole.
	I was at an event earlier today with the Prime Minister to celebrate 60 years of NHS research. When the NHS was established, the opportunities for medical advances were greatly expanded because it gave researchers access to vast numbers of patients and staff in a clinical setting for the first time. For example, the discovery in the UK in 1950 by Professors Hill and Doll that there was link between lung cancer and smoking could not have happened without the collaboration between the NHS and the Medical Research Council. That discovery was followed by breakthroughs in hip replacements, in detecting osteoporosis, in bio-engineering, in heart valves and in the word's first test tube baby, along with many other breakthroughs.
	The UK is a world leader in health research, responsible for 3 per cent. of the world market in medicine, but funding 11 per cent. of the world's medical research. We will continue to invest in science, innovation and research to ensure that we maintain this country's pre-eminence. Following today's summit, we will forge even closer links between universities and the NHS.
	Medical research is just one of the many advantages bequeathed by our predecessors in 1946, when the National Health Service Bill was approved in this House. It can hardly be said that the NHS emerged from deep political consensus and professional support. The historian Kenneth Morgan pointed out that the conflict between the BMA and the Government lasted longer than the second world war [Interruption.] The hon. Member for North Norfolk (Norman Lamb) says that it is still going on, and I shall come back to that in a few moments. My hon. Friend the Member for Livingston (Mr. Devine) cited a reference from a debate in this House 60 years ago. This was April 1948 [Interruption.] No, my hon. Friend was not there at the time! The Bill had become an Act, having received Royal Assent, and Bevan and the Government were forced to provide time to debate the NHS because of the huge opposition that had emerged from the BMA and the Conservative party. Let me read one quote from Nye Bevan. There are loads of quotes in these debates, but this one struck me as being perfect for the occasion. Bevan said:
	It can hardly be suggested that conflict between the BMA and the Minister of the day is a consequence of any deficiencies I possess, because we have never been able yet to appoint a Minister of Health with whom the BMA agreed.
	No change there. I am sticking to the tradition established by Nye Bevan.

Fraser Kemp: A constituent, Mrs. Elizabeth Porter, celebrates her 100th birthday next year. She spoke to me recently about what happened 60 years ago when she travelled on a bus from where she still lives in Shiney Row, Durham to hear Nye Bevan speak about the creation of the health service. She said to me that it was the greatest decision ever taken by any Government in the last century, because it took away the fear that she had in the 1930s of having to make a decision on health on the basis of whether she had 2 to call a doctor, rather than whether she needed help. Does my right hon. Friend agree with Mrs. Porter's analysis?

Alan Johnson: I entirely agree, and I cordially invite my hon. Friend's constituent to come to Westminster Abbey next Wednesday to celebrate the 60th anniversary of the NHS, as there will be many more NHS workers there and people who have benefited from it over the years.

Charles Walker: I am not one for celebrating institutions, but I am one for celebrating the people who work in them, particularly nurses, who make a massive and important contribution to the NHS. My concern is that too many district and community nurses are now subsidising the NHS because their mileage allowance was fixed in 2001 and has not risen since. Will the Secretary of State take a look at that and give the nurses a real present for their 60th anniversary?

Alan Johnson: Of course I will look at that, but today's occasion should not get bogged down in mileage allowances: let us look at the bigger picture [Interruption.] I know that there are three or four ex-nurses in their places around me now. As I said, I will look at the issue, but let us move on from mileage allowances to the big debate in 1948 about whether we should establish a national health service.
	I am unsure how the Liberals voted in 1946 [Interruption.] Well, there were only a dozen of them in the House at the time. But I do know how the Conservatives voted, and the hon. Member for South Cambridgeshire (Mr. Lansley) might like to know that the Conservatives voted against the Bill at every stage. There was a three-day Second Reading debate, at the end of which the Conservative Opposition voted against it. There were no rebels going through the Labour Lobbies. For us, it was unanimous. Again on Third Reading, however

Simon Burns: Will the Secretary of State give way?

Alan Johnson: Let me finish my point. The Conservatives voted against Third Reading, proving that this was an absolute point of principle for them. As I have already explained, two years later, Bevan had to come to the House with another debate because of the coalition between the BMA and the Conservative party, which was in fierce opposition to the establishment of the national health service.

Stephen Dorrell: rose

Alan Johnson: I give way to the former and very distinguished Secretary of State for Health.

Stephen Dorrell: I am grateful to the Secretary of State. One of his achievements in office is that my hon. Friend the Member for South Cambridgeshire (Mr. Lansley), the shadow Tory spokesman, is ahead of him in terms of public trust in handling health policy. That is an important event for the Conservative party, but I wonder whether the Secretary of State thinks he is likely to get himself ahead of my hon. Friend in terms of public ratings by digging up the history of who said what in the House of Commons in 1946?

Alan Johnson: Every poll I read puts us in the lead; I suppose it all depends which ones, but let that pass.

Jim Devine: Will my right hon. Friend give way?

Alan Johnson: In a few moments.
	I think that it would be really strange if, in debating an Opposition motion celebrating 60 years of the NHS, I did not point out the consistent support or otherwise of all political parties for it. I realise Conservative Members do not want to go over the history, but it would be perverse if we did not at least mention some of that history. Indeed, the hon. Member for South Cambridgeshire mentioned it himself.

Jim Devine: It might be helpful to the debate if Conservative Members in making their contributions or interjections told us whether they are covered by private medical insurance. The difference between Conservative and Labour Members is not only that we created the national health service, but that we actually use it, too.

Simon Burns: rose

Alan Johnson: The hon. Member for West Chelmsford (Mr. Burns) cannot intervene before I have risen to respond to the previous intervention. All we know is that an analysis of the Cabinet of which the right hon. Member for Charnwood (Mr. Dorrell) was a member showed that none of them used either the NHS or, indeed, the state school systembut we will draw a veil over that period of history.

Simon Burns: Interesting as it is for the right hon. Gentleman to give us a history lesson, does he accept that many Conservative Members, including myself, were not born in 1946 or 1948, and that we have supported the principle and the exclusive use of the health service ever since we were born?

Alan Johnson: I accept that point entirely. However, the hon. Member for South Cambridgeshire began his speech by quoting Winston Churchill in 1944, and went on to talk about Henry Willink, the shadow Health Secretary at the time and Health Secretary during the coalition Government, so perhaps we can be allowed to enter the same debate and talk about the history as well.

Norman Lamb: I am still waiting for the right hon. Gentleman to mention who laid the foundation stones of the NHSthe great Liberal, Beveridge. Will he please get on with that?

Alan Johnson: I will. Beveridge's contribution should be recognised, as indeed should that of Lloyd George, who introduced the insurance-based system that the BMA vehemently opposed in 1911 and then sought to protect in 1946so what goes around, comes around.

Joan Ryan: May I suggest that my right hon. Friend might get quite a long way ahead in the ratings if he told the House about the difference targets have made to cardiac mortality and death rates from cancer? Those issues are important to this evening's debate. May I also say to my right hon. Friend that despite the many discussions I have had with him and other Ministers about Chase Farm hospital, one thing I am absolutely certain of is that that hospital, as a result of all the efforts made locally and here, has a very bright future ahead?

Alan Johnson: I agree with my right hon. Friend, and I will come on to targets and outcomes a little later.
	The Conservative party voted against the National Health Service Bill at every stage, so has the NHS really had
	support from all political parties?
	Has this great achievement of a Labour Government been equally cherished by the Conservative party? I think the hon. Member for South Cambridgeshire may blush a little at that suggestion. The NHS was certainly not supported at birthin its infant and teenage years, perhaps.
	Moving on to the '80s, Baroness Thatcher, who famously went to a private hospital in Windsor rather than use the NHS, said as Prime Minister that the NHS was safe in her hands, rather as the Leader of the Opposition was saying earlier today. However, as Rudolf Klein, historian of the NHS, points out, in 1982 the Government's think-tank, the central policy review staff, produced a paper proposing the replacement of a tax-financed NHS by a system of private insurance. That was presented to Ministers by the Chancellor and promptly leaked to  The Economist, so it became a big scandal. History records that we can thank Lord Fowler, who was Secretary of State for Social Services, for killing off that proposal.
	We should also remember that every single [Interruption.] Just one second. We are coming up to recent history, which will be much more interesting to the hon. Member for Hemel Hempstead (Mike Penning). Coming up to recent history, we should remember that every

Andrew Lansley: Will the Secretary of State give way?

Alan Johnson: In a second. Every single Conservative Member won their seat on a manifesto that supported the NHS to such an extent that they would have paid people to leave it.

Andrew Lansley: Is the Secretary of State interested in history, as he seems to have glossed over the fact that since the 1950s, the year in which the largest reduction in NHS spending took placea reduction of 2.9 per cent. in real termswas 1977-78, under a Labour Government? Perhaps he will confirm that that is correct. Will he acknowledge that Governments both Labour and Conservative have sought to support the NHS, but that the year in which there was the least financial support for the NHS occurred under a Labour Government?

Alan Johnson: The Conservative party has tabled a motion saying that all political parties have supported the NHS. I am not dealing with the vagaries of finance; I am saying that the Conservatives opposed the NHS when it was founded, and came up with a plan to move to a national insurance system, which thankfully was scuppered, and that as recently as the last general election, every single Conservative Member stood on a manifesto that said that people could take money out of the NHS to go private. I point that out merely because of the terms of the motion.
	The hon. Member for South Cambridgeshire has tried to put all that in the past, primarily to try to encourage the public to forget what the Tories did to the NHS when they were last in government. That was an era of 18-month and sometimes two-year waits for life-saving operations. It could take weeks to get a GP appointment. As the chief medical officer tells us, when he was working in the north-east an 81-year-old man wrote to him to ask whether he could bequeath his place on the waiting list for a cataract operation to his nephew, who was 60 and developing eye problems. That man had been on that waiting list for 11 years. Waits in accident and emergency were sometimes 24 hours, and infection rates in hospitals soared.
	Such was the public anger that the debate was not always about how we could save the NHS, but about whether we should abandon it altogether. Now, thankfully, the debate is about how we take the NHS from good to great, and from world class in some aspects to world class in all. Here I come to my quibble with the Conservative motion. While it rightly mentions the need to focus on outcomes, as we are doing, it impliesthis point was referred to by my right hon. Friend the Member for Enfield, North (Joan Ryan)that targets have had no role to play in rescuing the NHS from years of neglect and underfunding.

Clive Efford: This is an area where the Tories have created more than a bit of confusion for me. Heaven forbid that we should ever have a Conservative in charge of the NHS again, but exactly what would a future Conservative Government be responsible for? Three issues have been raisedChase Farm hospital, which was mentioned by my right hon. Friend the Member for Enfield, North (Joan Ryan), and two others, which were raised by Labour Back Bencherson which local decisions were made to change the NHS to try to improve it and make it ready for the 21st century, but the hon. Member for South Cambridgeshire has prayed them in aid to attack the Government. There is localism and decisions are being made, but the hon. Gentleman brings them here to attack the Government. Exactly what would a Conservative Government do for the NHS, and who would be responsible for what?

Alan Johnson: That is a very good question.  [Interruption.] It is a very good question. Last week we had a debate on polyclinics. The argument about GP-led health centres [Interruption.] I will say it in words of one syllable: we had a debate last week about health centres. We heard that the argument against putting GP-led health centres in every part of the countryopen from 8 am to 8 pm, 365 days a year, with access for people whether they are registered or not; they can walk inwas that we were determining things from the centre.
	When it was pointed out that in London the proposals for polyclinics had come from a consultation involving clinicians and the population, that was opposed. When it was pointed out that there were proposals for a further three centres in Hull, in my own constituency, that was opposed. My hon. Friend the Member for Eltham (Clive Efford) is right to be confused: the Conservatives oppose what is driven from the centre, and oppose what comes from the local level as well.

Mary Creagh: Does my right hon. Friend agree that quality and dignity go hand in hand in the NHS, and that our target to ensure that all A and E patients are seen within four hours of entry to hospital is a massive improvement on patients spending the night on trolleys, as they used to in my local hospital, Pinderfields, 10 years ago? Does he also agree that the debate about targets and outcomes represents a semantic difference, and that we should all be working together to improve health care?

Alan Johnson: The public will be bemused by all this discussion about outcomes. They want to get through A and E in a reasonable time. They want not to wait years for an operation. Samia al Qadhi, chief executive of Breast Cancer Care, said this morning that targets had their uses. She certainly thinks that it is important that there are targets for the timing of cancer care in particular, not only because of the emotional distress of waiting for a diagnosis or for information, which should certainly not be underestimated as it is considerable, but because there is plenty of evidence that early diagnosis saves lives with breast cancer and other cancers. So there was no support there for this weird argument that we concentrate just on outcomes and there is no place for targets at all.

Barbara Keeley: I have referred to this before, but it is a key point about cervical cancer screening. We know we have a problem, which has developed more recently, with young women in their 20s and 30s falling away and not attending screening. There have been some wonderful initiatives, including one at Salford PCT, which has studied the process, worked with GPs and improved our uptake of screening in Salford by 7 per cent. It is true that we have to focus on process and on targets to achieve those different outcomes.

Alan Johnson: I saw what is happening in Salford when I was there a couple of weeks ago. When I went to King's, I also saw how the areas of south-east London where the most deprived communities live are being targeted to ensure that they get the breast cancer screening programme to reach the parts of the community that are most difficult to reach. Those are very important local initiatives. We reject totally the Opposition proposal that we should abandon targets. In achieving reduced waiting times and in tackling health care acquired infections, they remain important.
	The transformation of the NHS is due to the hard work and dedication of its staff, but national targets, together with sustained growth in resources, delivered significant progress: better access, improved treatment in A and E, better treatment for cancer patients and significant reductions in mortality rates from the major killer diseases. From December, no patient will be waiting more than 18 weeks for an operation following referral to treatment.
	I shall quote Professor John Appleby, chief economist [Interruption.] I mean that no patient would wait that long apart from those who book an appointment but decide that they do not want to have their operation yet, and those who decide that they are going on holiday.

Andrew Lansley: It is quite important that we are clear about that. For example, the Government will say that nobody waits beyond four hours in A and E, but last year 129,000 people waited more than four hours. There is a tolerance. I understood that Ministers were proposing an 85 per cent. target for the 18-week referral to treatment, so hundreds of thousands of people will wait beyond 18 weeks.

Alan Johnson: Why did the hon. Gentleman have to intervene? I was just mentioning the tolerance: the figure is 10 per cent., so there is a 90 per cent. target because of the fact that there is a tolerance and [Interruption.] The hon. Member for Guildford (Anne Milton) says from a sedentary position that I said nobody. Before the hon. Member for South Cambridgeshire intervened, I made it clear that there is a tolerance level, as there is for all targets.
	Let me quote Professor John Appleby, chief economist at the King's Fund:
	Every opinion poll and headline ten years ago said that if there was one thing the public wanted fixed in the NHS it was waiting times, and they've done it.
	His words:
	It is quite staggering.
	That is from the independent King's Fund. He continues by saying that
	the whole point of the targets was to change clinical priorities, because doctors seemed content to put up with long waits for their patientswhile patients were not content...There is no evidence that vital priorities such as urgent cases have been delayed.
	Patients do not want to see a return to perilous waiting times, and we will continue to be their advocates.
	We are now coming through the necessary era of top-down targets, and are refining and improving how we measure performance. As my noble Friend Lord Darzi of Denham has made clear, quality must be the organising principle of the service. We have already proved by our actions our commitment to letting go from the centre. In 1999 we relinquished power to determine which new drugs and technologies the NHS should adopt, and put it in the hands of a new independent body, the National Institute for Health and Clinical Excellence. In the same year, we established the Healthcare Commission and the other commissions, making them responsible for setting standards, and inspecting and reporting on every hospital, mental health and social care provider in Englandcompletely beyond the influence of politicians. Four years ago, we established NHS foundation trustsindependent of Whitehall, accountable to their members and making their own decisions on how best to serve their patients.
	The NHS is in rude health: we no longer debate its survival, but its continuing success. On Monday, we will publish our next stage review. From the NHS plan in 2000 right up to now, there has been consistency: first the resources; then the mechanisms for reform; and now a fundamental concentration on improving quality. A national, enabling framework will be driven by the local priorities set out by thousands of clinicians, patients and members of the public; they drove the process that set the direction of the health service in every region of the country. It was developed locally because local clinicians, patients and managers are best acquainted with the specifics of improving patient care, and are best equipped with the knowledge and ideas necessary to shape the future of the service.
	Unlike the situation in 1948, we are no longer in the age of infectious and acute disease, but in the age of chronic and lifestyle disease. The burden of modern and future health care systems will be to support an ageing population, to help those with long-term conditions to manage their care better, to promote health and well-being so that we can ward off disease, and to keep up with the astonishing advances in medicine and technology. Only through universal health care, free at the point of need, can we make sure that all citizens benefit from those advances. Whereas our national health service makes screening and vaccination programmes available to all, an insurance-based system could use what we discover about disease to increase premiums. Under such a system, the scientific knowledge that could liberate a patient from the threat of disease and early death would instead remove their right to treatment.
	At the beginning of the 21st century, therefore, the value of the NHS is even more important than at any time in the past 60 years. Only because of the attention and care that the Labour party has shown the NHSrunning beyond a mere expression of support, welcome though that iscan we address the challenge of today's health requirements. Massive increases in investment put us in touching distance of European spending levels. There have been huge gains in staff numbers80,000 more nurses and 38,000 more doctors. Every week another new building to host primary and social care services opens, and 125 new hospitals will be open by 2010.
	For today's NHS, the way ahead is through a greater emphasis on prevention, personalisation, individual choice and easier access to even safer services. It is right that we pay tribute to the NHS as we approach its 60th anniversary. Nobody would claim that it is perfect, but it is deeply cherished by the British public because of its enduring values, and because it epitomises the social solidarity that is as important today as it was 60 years ago. I commend the amendment to the House.

Norman Lamb: I am pleased to join in celebrating the 60th anniversary of the NHS. It is right to acknowledge and express appreciation for the massive contribution of the staff in the NHS, from those at the bottom of the organisation to the most specialist clinicians. The motion also rightly identifies the role of volunteers and charitable organisations, which often work in partnership with the NHS. They play a vital role, and are often staffed by people who have had a particular experience, or whose loved ones have, and who demonstrate a real commitment to the care provided.
	It is also right to acknowledge and celebrate the extraordinary founding principle of the NHSthat everyone, irrespective of income, should have the same access to care, based on need, not on ability to pay. As the other two Members who have spoken have acknowledged, it was a Liberal, William Beveridge, who laid the foundation stones of the NHS. It is a pity that the Liberal Democrats have not yet had the opportunity to administer the national health service, but one day our turn will come.
	We should never be complacent about the future of the NHS, its safety and security. It could be undermined by two factors: first, funding levels; and secondly, the way in which the money is spent.
	Back in 1997, at the end of the Conservative Government, this country was spending a third less than the average European spend on health. The consequences were there for all to see. Hospitals were decaying, and not enough doctors, nurses or other health professionals were being trained or recruited. There were real weaknesses. At the end of the Conservative years in government, whether we look at cancer, heart disease or stroke care, the outcomesthe issue on which the Conservative spokesman focusedfor people in this country were poor compared with those in other European Union countries.
	Today, a difference has been made to funding. This country now spends about 100 billion a year, which is a dramatic increase in investment in the health service. We supported that all the way through. We called for it in 1997, and when it came we supported it in votes in this Parliament. Given that funding has increased, however, we must ask, first, whether we are getting enough out of the investment, and secondly, how the NHS will cope with the challenges of the future.
	As has been said, the current spend is at about the European average. Yet, as the Conservative spokesman has said, our outcomes still lag behind Europe's on heart disease, cancer, stroke care

Andrew Lansley: And lung disease.

Norman Lamb: Indeed.
	This country has gross inequalities in health outcomes. That issue has not been focused on particularly in this debate, but we ought to focus on it. Health inequalities in this country continue to be completely unacceptable, and indicators suggest that they are getting worse, not better. I fully recognise that the causes of those inequalities are often well beyond the remit of the national health service, but the NHS has a role to play. Part of that role is to ensure equal access to health care, which we simply do not have at the moment, and that should be addressed. In some areas of health care, particularly those which are not subject to targets, access is still poor. I want to focus on mental health.
	Under the Freedom of Information Act, we did a survey asking mental health trusts across the country how long people have to wait for access to cognitive behavioural therapy. In some parts of the country, people have to wait more than two years; in many areas, the wait is more than one year. Given the view of clinicians that outcomes improve significantly as a result of early access to such treatment, it remains a scandal that people are having to wait so long for something that could make a real difference to them. One of the themes on which I want my party to continue to focus is the inequality between the treatment of patients suffering from mental health problems and the treatment of those suffering from physical health problems. That disparity cannot be justified, and must be remedied.
	In recent years, when trusts throughout the country got into financial difficulties and trusts were forced to deal with their balances, it was public health budgets that suffered, although they can do so much to prevent health problems from developing in the first place. The experiment that has taken place over the past decade, involving top-down command and control and big government, has clearly been found wanting. It has failed in so many respects.
	We see gross waste and inefficiency, and a dependency culture in which no innovation takes place at local level because the Government dictate everything to primary care trusts and hospitals. We see funding that always has strings attached, because the Government know best how the money should be spent. We see micro-management from Whitehall: the Government tell every hospital in the country to undertake a deep clean, at vast expense. The clinicians tell us that that is not the best way to tackle hospital-acquired infections; but the Government know best. Then there is the debacle of the Medical Training Application Service [Interruption.] Does the hon. Member for Cleethorpes (Shona McIsaac) wish to intervene? It appears that she does not.
	I was talking about the MTAS debacle. The Government sought to impose an entirely new system for the recruitment and selection of junior doctors throughout the country without piloting it first to establish whether it would work, leaving chaos in its wake. Similarly, we have an IT system that has been imposed from the centre.

Sandra Gidley: We do not have an IT system!

Norman Lamb: The crux of the problem is that, as my hon. Friend says, we do not have an IT system. It was a system designed in Whitehall, a political imperative. No cost-benefit analysis was undertaken. There was no proper review to ensure that people who were building the system, the people who were paying for it and the people who were using it understood the same thing. Nothing like that happened; all that was undertaken was a massive commitment to spend over very many years. What do we see now? We see the whole scheme running years behind schedule, according to the National Audit Office, and we see the total cost massively above budget.
	We see polyclinicssorry, GP-led health centresbeing imposed on every primary care trust in the country. The Secretary of State sought to defend that, but it is indefensible. It is not sensible to tell every primary care trust that it must have a GP-led health centre and that contracts must be concluded before the end of this year. Again, that is dictating to the health service because of political priorities and political imperatives rather than sound clinical judgment.

Stephen Hesford: Does the hon. Gentleman not understand that without some form of direction from the centre, without someone trying to organise what should happen around the country for equity's sake, the postcode lottery would come into the picture?

Norman Lamb: The remarkable answer to that is that we have a postcode lottery now. It is alive and kicking, and we have no accountability for it. Around the country, bureaucrats and people appointed centrally are making the decisions about access to health care. They are not accountable to the communities that they serve. We have the very problem to which the hon. Gentleman refers under our existing highly centralised system. The hon. Gentleman shakes his head, but we have it: it is there for everyone to see.
	We have myriad bureaucratic targets, which are often contradictory and have unintended consequences. Unlike the Conservatives, I see a role for targets. Every well-run organisation has targets to improve its performance. In the private sector every good organisation has targets, and for the Conservatives to speak of getting rid of all targets seems utterly bizarre to me.

Stephen O'Brien: National targets.

Norman Lamb: That is helpful, but I shall return to the subject.

Stephen O'Brien: Leave that bit out.

Norman Lamb: Despite that suggestion, I will not leave it out, because it is a central issue that needs to be addressed.
	We see endless botched reorganisations, and with every reorganisation come more payoffs to senior executives. They drive clinicians crazy, and they certainly drive the public crazy. A recent example is the enormous payoff700,000to a chief executive of a hospital trust in Leicester, aged 52, who now receives a pension of some 60,000 a year while also working as a consultant for the Healthcare Commission. That sort of waste of money drives people mad.
	We are not the only people who say that the health service is ludicrously over-centralised. As she reached the end of her troubled tenure last year, the former Secretary of State, the right hon. Member for Leicester, West (Ms Hewitt), made a speech to the London School of Economics in which she described the NHS as
	four times the size of the Cuban economy and more centralised.
	That seems to me to describe it rather well, and I suspect that the right hon. Lady was in the best position to make the judgment, having tried to control the beast for so long.
	This, then, is Labour's NHS: loads of cash, the right instincts certainly, but dreadful waste and inefficiency and an absolute failure to let go. Interestingly, the Labour manifesto at the last general election made a bold claimpromise, indeedto cut the number of staff in the Department of Health by a third, and to halve the number of quangos. Neither, of course, has happened. When we asked a question about the number of people working in the Department, the answer suggested that it was pretty much the same as the number three years ago.
	How can we meet the challenges of the future better than the top-down, command-and-control approach that has proved so wasteful over the past 10 years? We face enormous cost pressures in a modern health service. New technologies are emerging, and new drugs are constantly being developed. There is a continuing debate about top-ups and about how on earth we are to fund new drugs which, in many cases, can provide good clinical benefits but may not meet the NICE criteria for public funding. We face all the challenges posed by lifestyle conditions such as obesity, alcohol consumption and smoking; and, critically, we have a massively ageing population.
	I recently met a specialist in mental illness among the elderly in Liverpool. He showed me a graph showing the number of centenarians in our society over the next 50 years. It was frightening to observe the growth in the number of people who will reach the age of 100. At the same time, the ratio of people of working age to older people will change dramatically, so we are losing the work force that will provide the care for older people. Therefore, we face massive challenges. As well as all the extra cost pressures, we have to recognise that patients now expect something different. Nowadays, in all aspects of life, people behave as consumersthey want to make their own decisions and to have control over their lives. That is the case in health care as well, and the NHS must adapt to that. On top of all these matters, tackling the gross health inequalities that continue to afflict our country must be a priority in the years ahead.
	What is the Conservatives' solution? First, let me say that they are right to focus on outcomes. There can only be any point in all of this vast amount of public spending if we manage to make people stay healthier and live healthy, longer lives; that is the aim. However, that focus is only a partial solution, as willing the end does not always achieve delivery. We must always ask how we are going to achieve the improved outcomes that today's Conservative paper rightly points to the value of trying to achieve. Its approach is to scrap all national targetsto have no access incentives at all, as far as I can see. Under its plans, there will be no entitlements for individual patients across the country, wherever they live, to ensure that they get access to the health care they need.
	It is worth remembering the origins of targets. They emerged when the new Government came to power in 1997 because of the dreadful and unacceptable waste under the previous Conservative Government. The political debate in 1997 focused particularly on the fact that people were waiting so long for treatment. I remember when I was first elected to Parliament in 2001 taking up cases on behalf of constituents who were waiting three or four years for orthopaedic operationsfor hip and knee-joint operations. It is worth remembering what it was like; it was dreadful.
	Therefore, I believe that access is an important issue in its own right. While waiting for treatment, people often suffer from anxiety and trauma. If they are waiting for a hip or knee-joint operation, when it finally takes place the outcome might demonstrate that the operation has been performed well, but if they have waited two years to have the operation, they will probably have waited in severe pain and will also probably have had a carer who had to cope with them in that condition during that period.

Andrew Lansley: The document we published today is expressly a follow-up to the autonomy and accountability paper that we published last year. It sets out to define the basis on which the Government agree with the NHS boarda more autonomous boardthe structure of national objectives. That is not to say that the NHS board will not be responsible for issuing commissioning guidelines. It will be responsible for the contracting process between commissioners and providers. For services such as accident and emergency, there will be contractual conditions for the necessary quality. Patients' referral to treatment times will still be measured, and patients will still be able to exercise choice, and that choice will drive continuous improvement. It is important to be aware that what we are talking about is the national relationship between Governments and the NHS.

Norman Lamb: That suggests to me that waiting time targets might re-emerge, either locally or through the independent board.  [Interruption.] Well, if the Conservatives' conclusion is that they will not have either national or local targets or entitlements, I think there is a severe flaw in their overall package.
	We must never take access for granted. To focus on outcomes almost assumes that access is a given, but we can never assume that that is the case. Just as we have managed to improve waiting times, they can easily slipand we must remember those areas such as mental health where waiting times are horrendous. To abandon targets, and to have no access incentives and no entitlements for patients, will have potentially disastrous consequences. I also think it will run the real risk of worsening health inequalities. Our approach focuses on entitlements for patients and recognises entitlements to access treatment. It recognises that many people, who might not be articulate and understand how to play the system, will need help in exercising their choice and in making the right informed judgment. That is why we think that a network of patient advocates can help people in making the right decisions about their own health care.
	Let me now turn to what I think the priorities should be for the future of the health service, and to what the Liberal Democrats' approach would be. Let me deal with the question of pruning back the role of the central state. I have made the case against the Government's approach, which stands alone, if one makes international comparisons, in the extent to which it seeks to control the delivery of health care from Government offices in the centre. It seems to me that the Government should focus on key functions such as, first, the fair distribution of resources around the country, so as to ensurewithout political interference, incidentallythat the resources get to where the need is greatest. Secondly, it is right nationally to focus on high professional standards within the NHS. Yes, the Conservatives are right to focus on setting a framework for the delivery of improved outcomes, but it is also right to focus on the right to access to health care wherever people live in the country, and irrespective of their means.
	So yes, our approach is to recognise that access is important and to introduce the idea of an entitlement to access treatment within a defined period. The system in Denmark works well there. The idea is that people get access to condition-specific treatment within a defined period, and if they do not receive the treatment, it is paid for by the locally elected health board, if necessary in the private sector. Interestingly, it has not led in Denmark to a haemorrhaging of patients to the private sector; rather, it has been the biggest single driver of improved efficiencies within the state hospital system.  [ Interruption. ] It is absolutely not the patient passport, and the hon. Member is either being disingenuous or not understanding. The patient passport was a subsidy for people who could afford to top up the rest of their care for private treatment in the private sector. This system pays for a person's operation in its entirety. Crucially, in mental health, the person who has no resources to go to the private sector to circumvent the one-year wait for cognitive behavioural therapy would also be entitled to their treatment within that defined period, and if they did not get it, it would be paid for privately. That is giving real power to individuals, irrespective of their needs.
	We also believe that we should be empowering local communities, democratising primary care trusts and imposing on all PCTslocally elected health boards, as we would call thema duty to ensure the efficient use of resources. The health think-tank Reform has talked about an economic constitution for the NHS. That is the right approach, ensuring that money is used most effectively. Compare that approachempowering communitieswith that of the Conservatives. At the moment, one person is democratically elected within the health service: the Secretary of State. The Conservatives would lose that one person and have an independent board that was not democratically accountable in any shape or form. Just imagine: when a local community faced the loss of their hospital, they would have no right to decide locally whether that hospital would close. Decisions would be made by unaccountable, unelected bodies nationally. At that stage, in my view, the wheels would come off.
	The Secretary of State recognises that there is a democratic deficit within the health service but he appears unwilling to do anything about it. The Minister may well want to address that issue when he winds up the debate. We recognise that there must be democratic accountability within the health service. The Government recognise that there is a problem; what are they prepared to do about it?
	Thirdly, we want to empower patients far more than they are at the moment. No longer can we accept the idea of care delivered from on high to grateful, passive recipients. People want to take charge of their care and they need, as the Conservative spokesman said, access to information so that they can make the right choices; but as I have said, they also need access to support in guiding them in making the right decision. We also support the idea of individual budgets being piloted in the NHS and of seeking to give people more control in coping with long-term chronic conditions and so on.
	Our fourth principle is fairness, equity and addressing those health inequalities that scar our society. One of the issues that must be addressed is the fact that there is less access to primary care in poorer areas than in wealthier suburbs. The mechanism that the Government use is the central imposition of GP-led health centres, and they are also promising to bring more GP practices to impoverished areas, but surely the financial incentives to undertake primary care must also be addressed. At the moment, a GP receives more money if they practise in a wealthier area than they do if they practise in a poorer area. There should be financial incentives to encourage GPs to practise in those more challenging areas. We are developing the idea of a patient premium, whereby extra funding is attached to patients from deprived backgrounds to encourage GPs to provide support for those communities.
	As the NHS reaches its 60th birthday, it is time for an injection of Liberal thinking, as there was at its very beginning. The NHS can adapt, evolve and prosper. I am passionate about giving power to those people who have no power in our system. That is as important a principle in health care as it is in any other walk of life. Communities, not Government, should be in the driving seat in shaping the delivery of local health services; patients should take control. Fast, efficient, high quality care should be guaranteed to patients, putting individuals before institutions. That is how we should build on the past successes of the NHS as we look ahead to the next 60 years.

Stephen Hesford: I congratulate my right hon. Friend the Secretary of State for Health on setting out his case. I recognised more of a celebration of the national health service, which is supposed to be the theme of this debate, from the tone of his remarks than from those of the hon. Member for South Cambridgeshire (Mr. Lansley), who set out the case for the ConservativesI heard more carping than celebration from him.
	May I add to what my right hon. Friend said on the short history of the origins of the NHS? In the 1940s, not only did the Opposition vote against the principle of the national health service, but the Conservative Government, led by Winston Churchill, who took over from the splendid Attlee Government of the 1940s and 1950, were still so dischuffed with the NHS that they set up the Guillebaud committee in the early 1950s. The specific remit of that committee was to review NHS spending and the then Conservative Government hoped it would say that the NHS, as a publicly funded institution free at the point of use, was too expensive. In fact, the Tory Guillebaud committee said that the NHS was very good value for money, and so the Tories, at that stage, were stuck with the NHS. I submit that they have never properly digested that lesson.

Simon Burns: Will the hon. Gentleman give way?

Stephen Hesford: Let me make one further point, although I always enjoy the hon. Gentleman's interventions and I am looking forward to this one.
	As I was saying, that is why, at the last election, the Tories were still toying with the idea of the patient passport, which would undermine the principle of NHS financingthat it is free at the point of use.

Simon Burns: As the hon. Gentleman rambles down the roads of history and recalls a committee that recommended that the then Conservative Government continued to increase spending on the health service each year, to which they adhered, he has conveniently forgotten that three years earlier it was Hugh Gaitskell as Chancellor who introduced the charges for prescriptions and dental and eye care, which led to Wilson, Freeman and Bevan resigning from the then Labour Government.

Stephen Hesford: I am not sure what that has to do with the point that I was making

Simon Burns: My point was that the Conservatives may have set up a committee to get outsiders' views on the way forward, but they then continued to increase the funding for the health service each year. The previous Labour Government may have set up the health service, but they brought in financial cuts that led to three Cabinet Ministers resigning.

Stephen Hesford: The hon. Gentleman makes his point.
	I now want to come up to date. I have some sympathy with the hon. Member for South Cambridgeshire [ Interruption.] Yes, I do. We both entered Parliament in 1997 and I have watched his career with interest. I hope that that is not too much of a bar to his future progress, if any. I have always thought that his personal position is sympathetic towards the NHS. His problemand his party must address itis that the instincts of his party and his leader do not align with his. The hon. Gentleman is forced to be a cheap and shallow salesman for the NHS. On closer examination, Conservative policy is smoke and mirrors. As we get closer to the election, in 18 or 24 months, we will want to return to that argument.
	The hon. Gentleman is also a roadblock to reform. He and his party will not support the necessary reforms to take the NHS into the 21st century, and I shall give a couple of examples of that. The Conservative leader has promised to scrap extended hours for GP surgeries. That is not taking GP practices into the 21st century: it is going backwards. The hon. Gentleman well knows that most people's experience of the NHS is through general practice and primary care. If his party scraps extended hours as it has promised to do, it will reduce people's access to primary care. That is the charge that he must answer, and on which the House must decide today by voting for either the motion or the amendment.
	A further roadblock to reform is that the Conservatives would scrap the guaranteed two-week treatment wait for those with suspected cancer. They would scrap the guarantee that all patients should be seen within 18 weeks, from their first visit to the GP to their operation. The Conservatives do not seem to like that target or that guarantee. Why not? When they come to power, if they ever do, they do not want to be put on the spot and to be expected to deliver an NHS run on such guidelines.

Andrew Lansley: I hesitate to interrupt the hon. Gentleman, because he is making such a helpful speech from our point of view, but I must tell him that the 18-week target does not apply to cancer. Different targets apply specifically to waiting times for cancer. Perhaps the hon. Gentleman would care to visit Clatterbridge and discuss the matter with patients there? They will tell him that a target geared towards the time to first treatment that fails to take account of the time lapse before subsequent treatment or to consider the holistic outcomes is not a target that works in the best interests of patients.

Stephen Hesford: The hon. Gentleman mentions Clatterbridge, which is one of my local hospitals. I shall come back to it because I want to talk in detail about some of the work it does, so I am grateful that he mentioned it.
	I have mentioned salesmanship and smoke and mirrors, as well as the roadblock to reform. The right hon. Member for Witney (Mr. Cameron) has made empty promises on hospital closures, but the Liberal Democrat spokesperson, the hon. Member for North Norfolk (Norman Lamb), has already identified the problem: closures will be made without any political accountability, unlike at the moment. The Conservatives say that in effect there will be no local closures, but how on earth will the system be regulated when the service must modernise and new facilities, operation procedures and the like must be implemented [ Interruption. ] The hon. Member for South Cambridgeshire is chuntering from a sedentary position, but he does not want to intervene.
	The Conservatives would also put NHS finances at risk and, as I have said, finance has been a contention between the parties down the years. The right hon. Member for Witney is on record as saying that his party would allow hospitals to borrow against building and equipment, but that would put the financial stability of local hospitals at risk. Who would bail them out if they went wrong? Would they be allowed to close under the independent board? The Conservative party must explain to my constituents why such financial instability would exist.
	I suspect that the reason why the Leader of the Opposition is considering the idea of local hospitals' borrowing against their capital is that an element of central funding would be cut, so local hospitals would be required to consider raising their budgets. That policy would reduce central responsibility and create local responsibility, but run the risk of creating a postcode lottery and financial insecurity for local hospitals.
	The final element of the roadblock to reform is that the Conservatives are against GP-led health centres. Again, if there was a 21st century, forward-looking Conservative programme, I cannot see why they would be against them. In my constituency, for example, there will be a GP-led health centre. It will not destabilise local GPs. That entirely new facility will be open from 8 am to 8 pm and will bring new doctors into the Wirral. My working constituents' busy lives will be enhanced, as they will be able to choose between dropping in at the new centre when that is appropriate or convenient or going to see their own GP. That is a significant reform and improvement of the service in my constituency.
	At the request of my colleague MPs on the Wirral, since 1997 I have had the lead responsibility for dealing with local NHS matters. For the past 11 years, I have been in constant touch with the PCT and all other health local providers in the area, and I should like to take this opportunity to review the improvements that have taken place.
	The hon. Member for South Cambridgeshire said that the target-driven system left no room for innovation at a local level. That is utterly wrong, and completely outside my experience over the past 11 years. A few months ago, I visited the Wirral University Teaching Hospital NHS Foundation Trust. That is my local hospital, and I was shown an example of innovationa new machine in the urology department that enables the consultant to look at prostate trouble using a laser, thus eradicating the need for invasive surgery or investigation. The procedure takes only about two hours, as opposed to the overnight stay that used to be required.
	The machine is one of only two in the area, and I am pleased that my constituents have access to such an innovation. The urology consultant had read about it on the internet and then had a word with the hospital's chief executive and board of governors, who decided to buy it. That is a perfect example of how local innovation can make a new service available, and I simply do not understand how a system of targets designed to raise national standards and provide equity across the country can be said to be inimical to local innovation. Targets and local innovation canand dowork side by side across the country.
	I am delighted that the hon. Member for South Cambridgeshire mentioned Clatterbridge, a specialist cancer trust and a world-class oncology centre that provides excellent and timely treatment for people in the north-west and the Isle of Man. A recent Healthcare Commission described it as excellent, and Clatterbridge is a trust going forward into the 21st century.
	Again, the hon. Gentleman says, almost as a scaremongering tactic, that somehow the NHS is sclerotic in terms of its innovation. That trust has taken the courageous decision to spend 15 million to 30 million over the next five years on a linear accelerator across the water in Liverpool; that is a huge investment for a relatively small trust. It is doing that to save patients the trouble of having to come across the Mersey for treatment. That decision was taken at a local levelnot through some strategic health authority or diktat from Whitehall. It will immeasurably improve patients' experiences. The families who come from Liverpool and points north of it will not have to travel so far.

Stephen O'Brien: I was interested to note that the hon. Gentleman holds an important leadership position across the Wirral in respect of all the hospitals. No doubt he has had the same conversations as I have had with the people at Clatterbridge, who also serve my constituents. One of their biggest problems relates to tertiary referral. Owing to the Government's target regime, oncology centres are penalised because so many of the targets for which they are forced to try to qualify are so far outside their control, at the tertiary end of the process, that they find themselves struggling with financial penalties that they could do without.

Stephen Hesford: The hon. Gentleman has a point in that that was a problem historically. It is a perfectly serious point. When some of the targets were first introduced, they were clearly not designed for oncology trusts of that kind. They were designed more to relate to a district general hospital. There was some tension around that. I have investigated the matter on the centres' behalf to some extent, and my understanding is that that tension is now more historic and that accommodation has been made for such trusts in respect of those targets.

Ben Bradshaw: indicated assent.

Stephen Hesford: I see that the Minister is nodding; I think that I have described the up-to-date position. However, I acknowledge that there was a serious point to be made a few years ago.
	In a recent Healthcare Commission report, Cheshire and Wirral Partnership NHS Trust, the local mental health trust, was described as excellent; that trust is also innovating hugely in its outreach provision. Certainly the number of consultant psychiatrists that it has brought on board in the past five or six years has transformed its provision to my constituents and others in Cheshire and Merseyside.
	The hon. Member for North Norfolk rightly pointed out that the NHS has not always got mental health services right. However, I can honestly say that Cheshire and Wirral Partnership is innovating and making good progress

Andrew Lansley: indicated dissent.

Stephen Hesford: The hon. Gentleman is shaking his head; perhaps he wants to intervene.

Andrew Lansley: indicated dissent.

Stephen Hesford: He does not.
	I have mentioned my local district general hospital in passing. Two things happened to it. Under the old system, it was a three-star hospital. It became a foundation hospital and is going from strength to strength, I am delighted to say. I do not recognise the stifling of innovation at a local level that has been mentioned. The institution that I have mentioned used to be the second largest non-teaching hospital in the country. It is now a teaching hospital because it was able to innovate with local universities to provide a 7 million education centre on the hospital campus. That decision was made locally by the hospital with the aim of upskilling its staff, and I welcome that.
	The final local organisation that I want to mention is the Wirral primary care trust. I am proud to be able to say, as I have said in the House on a previous occasion, that my local PCT has been recognised for its innovations in the Wirral, not least on public health. Towards the end of last year, it was voted the best primary care organisation in the country for 2007-08.
	It may be that those excellent, innovative organisations on the Wirral peninsula are unique. Of course I am proud of my constituency and proud of the Wirral, but I do not believe that that is the casethey are exemplars of what is going on around the country. It would be a huge coincidence if I just happened to be the lead MP for health in the Wirral and we had uniquely good health services. I would like to think that, but it is not so.
	I pay tribute to the staff in my local health service, which is the second largest employer in the Wirral. Some of the local practices have been innovative in working with part-time workers, ensuring that public transport is available, and advancing green issues by making imaginative use of the local Sainsbury's car park. Such arrangements have enabled staff and patients to use the hospital in different, innovative ways.
	I am proud that the local NHS in my constituency is in such good shape for the future. I commend the work of this Government and look forward to working with my hon. Friends as we take matters forward for another 60 years.

Stephen Dorrell: I begin by congratulating my hon. Friend the Member for South Cambridgeshire (Mr. Lansley) on tabling the motion and on the tone in which he introduced it. The key point that he wanted to draw outI wholeheartedly agree with himis that the political fact in 2008, as opposed to 1946, is that the national health service is built on a political consensus that includes every single Member of this House from every party.
	A key element of the background to my hon. Friend's initiative in introducing the debate is that it is a relatively unusual experience over the 60 years of the NHS for a Conservative spokesman to be able to point to opinion polls saying that the Conservative party is the most trusted party on health policy issues. I congratulate him on achieving that as our health spokesman; I certainly never achieved it when I held that post some years ago. The important point is not to luxuriate in the fact that we are more trusted than the Government on health care, but to draw a political conclusion about the fact that Labour spokesmen go round the country saying that because the Conservative party voted against the national health service in 1946, it is somehow not committed to the principles of the health servicedespite the fact that we have been responsible for it over 35 of its 60 years of history and have never taken action that undermined the principles of the health service.
	I say to my hon. Friend the Member for South Cambridgeshire that the more often he can create opportunities for that argument to be developed, the more it suits our purpose, because it demonstrates that the arguments used by our political opponents cut no ice with the voters. The voters regard us as the more trusted party because they accept that there is no point of difference on the matter in the House of Commons. There is an all-party consensus on the principles of the national health service, and the true debate in politics is not who is committed to it and who is not, but who can deliver. On the 60th anniversary of the NHS, we should focus on that argument.
	The charge against the Government is the one I mentioned during a brief intervention on my hon. Friend. The Government have hugely increased the budget of the national health service over the past 11 years. I applaud them for thatit is the right thing to have donebut they have not brought about the improvements in the delivery of health outcomes and health care that we should have expected for that scale of resource increase. One or two of our more partisan supporters say that all that money has been spent, but that there has been no improvement. That is not true. Of course there has been an improvement in the delivery of health care in Britain over the past 11 years, just as there was during the previous 49 years. A year-by-year improvement in the delivery of health care is the consistent story of the NHS since 1948.
	If we are to be reflective on the 60th anniversary of the health service, what should disappoint us is that over the past 11 years there has been a huge increase in resources, but no improvement of performance commensurate with that increase. The question is, why is that true? Ironically, some analysis of the reasons for that failure is implicitly shared by those on the Opposition Front Bench and those on the Government Front Bench. If we look at what happened to health policy during the past 11 years, we see that the truth is that, in some important respects, it has gone round in a huge circle.
	The neatest way of encapsulating that is to refer to a speech I heard made in the summer of 2006 by Paul Corrigan, the health adviser to the former Prime Minister, Tony Blair. He explained that as a result of the insights of Mr. Blair, a new idea had been introduced into the health servicecommissioning. By empowering commissioners, we would introduce conditionality about the use of resources, and we would ensure better value in terms of efficiencies and health outcomes for the money provided by the taxpayer. I am afraid that when I heard that speech, I could not resist observing that its sentiments were precisely the same as those in the comments made by Professor Sir Donald Acheson, who was the chief medical officer when I first became a Health Minister in 1990 and my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) was Secretary of State for Health.
	The truth is that we introduced what we called purchasing and it has now been relabelled commissioning. We introduced trusts; the hon. Member for Wirral, West (Stephen Hesford) referred to the importance of local decision making and trusts and I entirely agree. We introduced what we called GP fundholding, and the Government introduced practice-based commissioning. A gigantic circle has been drawn and the health service's institutional framework today bears a sharp resemblance to the one that we left in 1997. The regret is that it has taken so much money and such a long timewasted time and moneyto get back to the point that we had reached in 1997, not in resources, for which I give the Government credit, but in their use and the management of health service institutions.

Several hon. Members: rose

Stephen Dorrell: I am spoilt for choice, but I shall give way first to the Under-Secretary.

Ann Keen: Will the right hon. Gentleman comment on waiting lists? What was happening to waiting listsfor cancer, hip and heart operationsin 1997? People died on those waiting lists, as he knows.

Stephen Dorrell: I shall now inveigh against a slight conspiracy between Conservative and Labour Front Benchers. It suits both sides to say that the Government invented national targets for waiting times in 1997. That is untruethey were invented by Virginia Bottomley before I became Secretary of State. Waiting times were reducing well before I became Secretary of State. They continued to decrease during my time in post and reduced further after 1997 as a result of national waiting time targets.
	The point that my hon. Friend the Member for South Cambridgeshire makes about national targets, with which I wholeheartedly agree, is that they were introduced in the early 1990s to tackle precisely the problem to which the Under-Secretary referred. They were effective before 1997 and became more effective afterwards, but the commitment to national targets has now become obsessive, distorting the use of resources.

Clive Efford: I accept that there is some cross-fertilisation of ideas about the future of the NHS. However, on commissioning, the right hon. Gentleman needs to explain how the choice in the manifesto on which he stood to allow patients to opt out of the NHS fits into the framework that he describes.

Stephen Dorrell: May we debate election manifestos for previous elections on another day?
	I believe that targets are symptomatic of a deeper malaise, which has been the focus of some work that the Local Government Association initiated on a commission on which the hon. Member for Wyre Forest (Dr. Taylor) and I had the honour of serving. It examined the national-local balance in the NHS. I believe that the Government have got that wrong, and it is vital to tackle that as we look forward, beyond the 60th anniversary of the NHS.
	The former Health Secretary described our current health system as being more centralised than Cuba. I used to say laughingly to my colleagues in the Division Lobby that I was the last manifestation on earth of Marxist-Leninist ideas. We were both saying the same thing in different ways: the culture of the NHS attributes too much authority and power to the centre and inadequate authority and influence to the local view. The result of that is the current debate on polyclinics. In some circumstances, they are a good idea. What is wrong is that Department insists that, because it is a good idea, everybody do it.

Ann Keen: indicated dissent.

Stephen Dorrell: The Under-Secretary shakes her head but it is deeply imbued in the culture that, when a good idea is proposed, the immediate question follows, Why can't everybody have one?
	We need a stronger local influence in shaping the NHS around targets and polyclinics and dealing with one of the consequences of over-centralised health care provision: too much concentration on the issues that grab the headlines, acute medicine, and too little on community medicine, mental healthall the Cinderella services that always lose out when a high profile debate goes on in the national newspapers.
	Of course there needs to be a national view in the national health service. When people observe differences in different parts of the country, they will ask why they exist and whether they should exist. However, I invite the House to recognise that one perverse consequence of an over-centralised culture is precisely those health inequalities in different parts of the country that the hon. Member for North Norfolk (Norman Lamb), the Liberal Democrats' spokesman, referred to earlier.
	We have an over-centralised culture that delivers, at the local level, an unacceptably wide variety of health outcomes. What my hon. Friend the Member for South Cambridgeshire is rightly seeking, and what we were arguing for through the Local Government Association commission, is to empower local people. If we do that, we will find, ironically, a greater similarity of outcomes, because by decentralising management we empower people to address the inadequacies of the health care delivery that they experience locally.
	As we look forward to the next 60 years of the health service, I hope that we can move on from silly arguments about who is committed to it. Over 60 years, we have all been committed to it, and we all remain committed to it. However, if we are going to deliver the objectives that our constituents have for it, we have to move away from a model of over-centralised management that has failed in all its other manifestations on earth, empower local people, local management and professionals, and learn to let go. By letting go of over-centralised controls, we will deliver better health outcomes and, ironically, a more common experience of health outcomes in different parts of the country.

Simon Burns: I join the Secretary of State in congratulating my hon. Friend the Member for South Cambridgeshire (Mr. Lansley) on calling this debate. I am delighted and privileged to be taking part in a debate celebrating 60 years of the national health service.
	I have heard many history lessons this evening. I was not even born in 1946, when the legislation went through the House, or in 1948, when the health service was established. However, I know from experience, throughout my life as a user of the health service, that in principle it is second to none. The national health service is what this country wants, and it is what I passionately believe in. It is ludicrousindeed, I find it quite bafflingto try to make complaints about an era in which we were not alive. If one worked on that argument, one could say that the Labour party still wanted to take us out of Europe, that it supported CND or that it did not believe in war, as George Lansbury, its pacifist leader in the 1930s, proclaimed. However, that is nonsense, because life has moved on, and so have circumstances.
	As my right hon. Friend the Member for Charnwood (Mr. Dorrell) and other hon. Members said, it is right that we should all be united on the basic premises and principles of the national health service, even though we may argue and have differences of opinion about how it should be organised and how it should evolve to continue providing a first-class health service for the people of this country.
	Why is the NHS so important? Why is this national institution so popular with the vast majority of people in this country, who are more than happy, as I am, to pay their tax pounds to have free health care at the point of use for all who are entitled to use it? One of the reasons is this. In the 1930s, Franklin Roosevelt talked of the four freedoms: freedom from fear, freedom from want, freedom of speech and freedom of worship. I believe that there is a fifth freedom. Some hon. Members have talked about the American experience. If we exclude those people who qualify for Medicaid and Medicare, because of their financial poverty or their age, there are more than 40 million people in the United Statesworking familieswho cannot afford health insurance. They do not have the freedom from fear of the next health bill landing on the mat, which might financially destroy their family. They do not have the freedom from fear that illness might come into the family, either to a child or to a parent, which might financially cripple them. Since 1948, because of our national health service, everyone in this country has had the freedom from those fears.
	I passionately believe in and support the national health service, whether it is under a Labour Government or a Conservative Government. Let those people who say that Conservatives are not committed to the health service look back over the past 60 years. They will see that Conservative Governments were in office for 35 of those 60 years, and nothing was done under those Governments to undermine the principles of the national health service or to seek to destroy it[ Interruption.] I resent people taking cheap opportunities to try to score party political points when there is no basis in fact for that argument.

David Anderson: Will the hon. Gentleman give way?

Simon Burns: I will not give way, because there is not much time.
	We have differed in our approaches over the way in which we believe the health service should operate. There has been too much of a propensitycertainly under this Government, but also under Conservative Governments in the pastfor politicians to interfere when they come into office, and to feel that they have to prove their stamina and machismo by making changes, sometimes, it seems, just for the sake of it. The national health service has had too many changes and reorganisations under successive Governments. It is suffering from a surfeit of change and from fatigue. It needs to be able to settle in with what it has, and to get on with the job that it is meant to be doingproviding first class health care for all.
	That is the challenge to politicians of all political parties. The reorganisations and changes have inevitably led to money being wasted and, certainly over the past 11 years, in certain areas, to almost going full circle and coming back to square one, with upheaval and waste of resources in between. That, too, has to stop. We need a health system in which the medical practitioners, who are the best qualified to make the judgments, make those judgments for the furtherance of patient care, rather than one in which politicians dictate from Whitehall what they believe should be happening. To give the health service that freedom, within its existing principles, would be a tremendous step forward that would benefit patient care and the working of the health service, as well as saving money from waste that could then be reinvested in patient care, which is the most important thing.
	We can all find problems in the health service in our constituencies, but this debate is not an appropriate time to express those criticisms. There are other opportunities to make those speeches in the House. Today, we are celebrating the health service. We must celebrate the tremendous people who work day and night to look after patients and to provide patient care: the nurses, the doctors, the consultants and the often-forgotten ancillary workers who are so crucial to the delivery of health care and the working of our hospitals. They are the unsung heroes of the national health service; they are the people at the front line of patient care and health care, who do so much that is too often unrecognisednot through ingratitude, but because they do their job so well that they become seamless in the whole provision of health care. To them, we owe our thanks and a debt of gratitude for all they do; we should not forget that.
	We must also ensure that our local communities have the best facilities and the finest equipment that money can buy to provide health care within the budgets that Governments provide. As my right hon. Friend the Member for Charnwood said, it is no secret that this Government have substantially and significantly increased health spending over the last eight years. I, of course, welcome that. I have to say, however, that they have been in an extremely fortunate position because the strength of the economy over the last 15 years has enabled them to generate the revenue to invest in health care. That is a benefit for all of us. The sadness has been that not enough of it has gone to front-line services. That is why it is crucial that we have mechanisms in an ever-evolving health care system to ensure that we get the maximum amount of money that the state makes available to the health service to front-line services in order to continue to improve and advance the treatment of our patients.
	I concludeI know that others want to participate in the debateby saying that we should stop the nonsense of Labour Members trying to accuse Conservative Members of not believing in the health service. Government Members may not like it, but we do believe in it. There is no monopoly of caring and belief in the health service on the Government side: we all share an affection, a loyalty and a devotion to the health service. What we all want to do is ensure that it works at its finest, providing the greatest health care. We may have differences, which we can argue about until the cows come home, but no one should question the motives or the honourable intentions of Conservative Members just because it suits the political agenda of Government Members at election time.

Richard Taylor: With some exceptions, I have been desperately disappointed with this debate, which instead of being a celebration of 60 years of the health service, has descended into party political bickering. I was hoping, as there was no time limit, to devote a little time to reminiscing. I have been in the health service more than 50 yearsmuch longer than most other people hereso I can remember the days when we had precisely three antibiotics: streptomycin, penicillin and tetracycline. We did not have MRSA because there were so few antibiotics that the bugs could not get used to them. We had aspirin, morphine and digoxin. We had largactil and the barbiturates, but no antidepressants, no tranquillisers, no beta blockers, no ulcer healing drugs, no ACE inhibitors, no statinsand I could go on for a long time. The British National Formulary in those days was absolutely useless, because there were no drugs to put in it.
	We did not know how to do endoscopy, ultrasound had not come in, computerised tomography scans had not been introduced, and magnetic resonance imaging was a long way off. Diagnoses were still made the proper way by taking a careful history, making a careful examination and carrying out a few investigations to prove what a doctor was already pretty sure of. We were still in the days of William Osler, who wrote:
	One finger in the throat and one in the rectum makes a good diagnostician.
	I do not think that he expected both fingers to be in those places at the same time, because one would have had to be something of a contortionist, but that phrase makes the point that clinical skills were necessary.
	There is not much time to reminisce, but let us remember what used to happen with heart attacks. All we did when I qualified was to put the patient to bed and hope. Patients were kept in bed for four to six weeks, and if they did not get a pulmonary embolism, the doctor was really lucky.
	I was working at the London chest hospital when external cardiac massage was discovered. We were staggered by its effectiveness; people were awake when we did it. I was involved with the very first pacemakers used. Since then, the first major cardiac care breakthrough came in the 1980s with the invention of the clot-busting drugs and the ACEangiotensin converting enzymeinhibitors, which transformed the treatment.
	We have come a vast distance with the treatment of heart attacks, with the immediate reboring of the arteries when necessary. We know how to prevent heart attacks, at least by attacking smoking, diet and high blood pressure and by using the statins. Now, the British National Formulary is the most prized document that any doctor carries with him, because if doctors use it well they cannot really make any mistakes with prescribing.
	Any celebration has to give credit to the staff, the doctors, the nurses, the secretaries and the volunteers in the charities. Above all, credit must go to the patients, who are so tough, stoical and co-operative with the staff. I worked with patients with rheumatoid arthritis for a long time; it is a most painful, disabling disease. Until very recently it was uncontrollable, yet those patients remained cheerful.
	Looking briefly to the future, what are the challenges? They have been mentionedvastly increasing longevity, the incidence of dementia, and vastly increasing costsand resources are crucial. We must optimise the use of resources. Economies must be made. The Government are to be congratulated on the better care, better value indicators, which at least make a start on making appropriate use of so many resources.
	We must eliminate the medical errors, along with the immense costs associated with them, and we must get prioritisation correct. I was not allowed to use the word rationing in a debate not long ago, but health care rationing is crucial, and it demands an open, honest and widespread debate. If there was more money availablenot by getting more, but by making better use of what we haveperhaps the National Institute for Health and Clinical Excellence would allow us to afford more drugs. If NICE were able to assess new drugs much more quickly, we might not have the huge problems of co-payments, which have been raised so frequently recently.
	Reorganisations have been mentioned many times. When the Health Committee undertook an inquiry on foundation trusts, we listed the reorganisations between 1982 and 2003. There were 18 in those 20 years, and the pace of reorganisation has continued. We face perhaps the biggest change and reorganisation of all with Lord Darzi's review. The one comfort is that he has said clearly that no changes are to be made until the replacement service is up and running. I hope that that happens.
	I am grateful that the Government have reaffirmed the principles of the NHSthat it is funded by general taxation and free at the point of deliveryand that those are immutable, but there is one vital bit of Bevan's work that is missing. Bevan realised that we had to pay doctors and nurses the same across the country to get universality of providers and a real national health service. So a consultant working in London was paid the same as a consultant working out in the country. That achieved a real NHS. My sadness is that with the internal market and the purchaser-provider split, as well as the interests of shareholders in the large commercial organisations tendering for parts of the core NHS, there is a risk of seeing the NHS as we know it disappear.
	I shall finish by talking about quality of care. I am delighted that the Secretary of State must have read the old proverb,
	A merry heart doeth good like a medicine,
	because he is persuading the nurses to smile. There is no doubt that cheerful, kind and sympathetic caring by doctors and others, and doctors and nurses who communicate with each other and with patients, will do away with most of the complaints that I receive. My problem is to know which to vote for: the motion or the amendment. Both have good points. If we have votes on both, I will have the greatest pleasure in voting for both.

Stephen O'Brien: It is a genuine pleasure to wind up this debate to mark the 60th anniversary of our national health service. The debate has allowed contributions from all parts of the House expressing both personal and national gratitude for the unparalleled institution that we call our national health service, and above all for its staff.
	The NHS is the Conservative party's No. 1 priority. We are not unique in thatit is the No. 1 priority of the people of this country. We have committed ourselves to it financially, and have laid out foundational policy to preserve and enhance its strength. We have the determination to trust front-line staff with decisions, and to set our NHS free from politically inspired micro-management. We have brought forward this motion to celebrate our NHS, and we are glad to use our Opposition time in that way.
	As is the case with Members on both sides of the House, Conservative Members are unequivocal advocates for and supporters of the NHS. I am proud that my mother was an NHS nurse who started her training in the late 1940s, shortly after the founding of the NHS, and retired in the late 1980s. I am also married to a nurse; by that stage, the qualification was no longer as a state enrolled nurse, but as a registered general nurse. My family also uses the NHS, and I am glad that we have had excellent treatment and outcomes.
	In this 60th anniversary year, I pay tribute to the hard-working front-line staff in the NHS, and the volunteers who, together with the many charitable organisations, support and care for patients, day in and day out. As my hon. Friend the Member for West Chelmsford (Mr. Burns) said in a powerful and impassioned speechI am sure that the House will turn to it, and that his constituents will be proudthe Conservative party, among many others, has supported the principles of the NHS from its outset. There is a strong national consensus on the values of the NHS. The British people are rightly proud of it as an institution of whose values we can be proud internationally. We are rightly proud that everyone has access to high-quality care on the basis of need, regardless of their ability to pay.
	We all have stories of the hard work of front-line professionals when both we and our families have been under the care of the NHS, and will have heard similar stories from our constituents. We also take up those times when the NHS, for all its great benefits and values that we are keen to celebrate, occasionally fails to meet its own standards.
	The debate has been interesting and wide-ranging. My hon. Friend the Member for South Cambridgeshire (Mr. Lansley) set the tone in a way that accorded with how the House sees the NHS. He sought to ensure that we celebrated an NHS that is and should be, in many respects, above party politics. In a relatively short debate, he did not necessarily delve down into the policy and detail, but painted a clear, optimistic, enthusiastic vision for the future. It was heartening to note that the hon. Member for North Norfolk (Norman Lamb), whose opening remarks also celebrated the staff of the NHS, largely supported my hon. Friend.  [Interruption.] Indeed he did. I am glad that we had the chance to put him right on the question of national targets, and that he can now enter that debate in the right spirit.
	The Secretary of State, who has not been able to return to the Chamber, observed that he agreed with every single word of the Opposition motion. Indeed, all that the Government chose to do in their amendment was add to the motion. That set a tone that I think we all hoped could be sustained, but to everyone's surprise it took the Secretary of State a further 15 minutes to deal with an historical obsession with 1948, and perhaps with 1946 as well.
	If we are honest, all of usMembers throughout the Housewill admit that when we talk to our constituents, it is clear that one thing that does not concern them is what took place in this Chamber in 1948. What does concern them is what will happen to their health service in years to come. That is why it is so important for us to demonstrate our ability to criticise what is happening, and to ensure that we are committed to the future.
	Despite what struck me as unnecessary, somewhat inappropriate and disappointing partisanship on that score, one certainty emerged from all the speeches. It was articulated by the Secretary of State, and again by Conservative Members. What is clear is that there is no dispute but a total, not even qualified, consensus among Members throughout the House, on behalf of all the people of this nation, that we are committed to the operation and values of the NHS.
	I was delighted that a former Secretary of Statemy right hon. Friend the Member for Charnwood (Mr. Dorrell), who spoke with great authority and knowledgewas able to confirm the existence of that total consensus, and the adherence to those principles by all who represent the people of this country in the House. He rightly urged us to move on from what has, at times, been a sterile debate that has not resonated with what people think about the real issues, and to deal with the true debate on who is best placed to deliver what everyone wants to achieve: improving health outcomes in a way commensurate with the huge resources that the country is willing to commit to the NHS in which we all believe.
	My right hon. Friend was also able to demonstrate that we have come full circle. He gave the example of the introduction by the current Government of commissioning, which had remarkable resonances with procedures and challenges that he and his immediate predecessor had experienced. There have been some wasted years, but we can move on. What my right hon. Friend urged the House to do, above all, was ensure that we retain our confidence in the NHS and learn to let go so that wethe politicians who are accountable in the House for the resources that are committedcan feel confident that the NHS, clinical and non-clinical, can deliver the outcomes that we want.

Peter Bone: Is not the Government's history one of missed opportunity? While doubling the amount of money spent on the NHS, they have increased output by only 29 per cent.

Stephen O'Brien: My hon. Friend has made an important point. This is not a question of party political partisanship; it is a question of the accountability involved in trying to make the resources committed commensurate with the results that we are all trying to achieve. That is to do with the operation of the NHS, and that is whyas my right hon. Friend the Member for Charnwood pointed outit is right for us to have debates such as this in order to decide how best we can deliver the results that we all want.
	The hon. Member for Wirral, West (Stephen Hesford) made a long speech that went round the houses and a number of parts of the Wirral. It left us wondering what debate he was contributing to, because it did not seem to relate to anything else that was going on. As for the all too short contribution by the hon. Member for Wyre Forest (Dr. Taylor), I think that while many us shared his disappointment that the debate had been diverted by some chippy approaches and contributions, we were grateful for the opportunity to hear his reminiscences, not least because he is probably the Member with the most experience of the NHS over a long period. He has committed himself to the health service throughout his life, and we salute him for that.
	Staff, volunteers and charities support the increasing improvements in health outcomes that we all want to see in the NHS, and we should not lose sight of the importance of research and development, either. I pay tribute to the Secretary of State for emphasising that in his speech, as it is vital.
	In today's debate, not only has the need to move from a target-driven NHS to a health outcomes-driven NHS been spelt out, but so, too, has the means by which we can achieve that, which is what people want. I hope that the Government, who no doubt had their eyes and ears officially at the launch of our document today, are listening carefully, because our proposalsand this documentare there for them to pick up. We do not just have pride of authorship in the document; we hope that they will pick up on it, as it will lead to better health outcomes for our constituents and give a proper chance for the NHS to develop over the next 60 years in the way that we all wish, particularly as we celebrate its first 60 years.
	In congratulating the NHS on its 60th anniversary, we thank, celebrate and encourage all the staff, past and present and clinical and non-clinical alike. They can be assured of our support on behalf of our constituents, and know that all of us draw inspiration from the very idea of the NHS. All we want is for it to reach the levels of improvement that we know it can achieve when the people in it are trusted to deliver the improved health outcomes we all want. I commend the motion to the House.

Ann Keen: I, too, am exceptionally proud and very pleased to wind up in this debate on 60 years of the health service. First, let me say to the hon. Member for Eddisbury (Mr. O'Brien) on his history of family nursing, I think it is time I met Mrs. O'Brien.
	This July, we celebrate the 60th anniversary of the NHS, which is not only a great institution but a great, unique and very British expression of the ideal that health care is not a privilege to be purchased, but a moral right secured for all. Opposition Members have made much about references to history. They might have a point if they were talking about 1946 and 1948, but I cannot see how history can start as recently as 2005that is not long agowhen the Conservative election manifesto proposed patient passports, and not all Conservative Members agreed with the funding of the NHS in that way. Surely, 2005 cannot be described as history?
	Much has been said in particular about the NHS founder, Aneurin Bevan, but also about Sir William Beveridge, who looked at the five giants. However, since I was first elected as a Member of this House in 1997 the main Opposition parties have voted against anything that would actually bring about the defeat of the five giants of want, disease, squalor, ignorance and idleness. That is not history; that is 1997, when the greatest inequality addressed in the House was to do with the minimum wage, and the Opposition parties voted against that.
	I therefore feel that history is not, perhaps, what we should be discussing, but I can certainly give a lesson in herstory, because herstory worked in the NHS throughout most of the time that the Conservatives were in government. I visited the north-east today, and met staff who were born in 1948 and who are working in the NHS today. I particularly want to mention Irene Lerche, who is an appointment and records officer, and Agnes Donoghey, who works for domestic services. I also met up with an old friend: an ambulance driver who was in Chester.
	Ten years ago, people questioned whether the British NHS could survive. It is a testimony to the extraordinary work done by nurses, doctors and all NHS staff [Interruption.] I ask Opposition Members just to take a lesson from herstory; she only has a few minutes. In the 10 years since I have been in this House, the NHS is more firmly than ever part of the fabric of British national life.
	Deaths from cancer and heart disease have fallen dramatically and Britain is one of the safest places in the world to give birth. The NHS is the largest employer in Europe. Its staff both past and present have helped to care for tens of millions of people and saved many hundreds of thousands of lives. We acknowledge that the NHS has come through difficult times, and it is a testimony to the hard work and dedication of its staff that it has turned a 547 million deficit in 2005-06 into a 515 million net surplus at 2006-07. All are to be congratulated.
	Tonight, we also need to recognise the volunteers and charitable organisations that have made a huge contribution to the success of the NHS and to the health and well-being of patients. We would particularly like to thank charities not only for their contribution to patients' and their families' lives, but also for their support and ongoing partnership with the Government, which is so valuable in determining the best outcomes for patients. Be it our cancer strategy or our stroke strategy, all have contributed; everybody feels part of this NHS. Stakeholders are constantly consulted and their documents shared, and they are proud of the documents that they have produced. Not acknowledging the organisations that praise the national stroke strategy in particular does nothing for the Conservative party. The chief executive of the Stroke Association has highlighted that strategy, which I believe it is celebrating this week.
	One million more operations a year are performed, and heart operations have more than doubled, so I am pleased to say that we do more than hope; we are really meeting our targets on heart disease, which should be welcomed by the Opposition parties. If this is a true debate on really acknowledging the changes that have taken place, we should have the acknowledgment that the targets have made a difference. The difference that they have made is that people are alive, and their quality of life is better. They are not in pain or worried about whether they will see the end of the year out, until the next waiting list figures are produced. They are alive and well and their quality of life has increased dramatically. That is thanks to the dedication and commitment of staff. A number of NHS trusts around the country have already delivered on the 18-week targetnine months early.
	Next week, the NHS next stage review will build on the progress that it has made with a new vision for the NHS based on care that is fair, personalised, effective and safe. We commend our noble Friend and colleague Lord Darzi and his work. The major review that he has led will inevitably result in a significant improvement in patient-centred care. I am quite clear that the NHS must continue to change. To quote Sister Wendy Larmouth, the sister in charge, along with Professor Andrew Cant, of the northern regional bone marrow transplant unit,
	we no longer do ordinary, we now regularly do extraordinary.
	That is a truly remarkable team, and the unit is ranked No. 3 in Europe. We must continue to organise medical expertise so that the highest standards of care are available to all patients. If we can achieve all thisI hope Members throughout the House agree that this should be a shared objectivewe will make the NHS safe for future generations.
	At the last election, we fought battles on the NHS. We have constantly been reminded in the House of the history. Are you thinking what we're thinking? was a slogan at the time. Well, the British people knew what to think. They re-elected a Labour Government to secure the NHS. I believe that the NHS is the best insurance system for the long term, and even more relevant to Britain today than it was in 1948. I commend our amendment to the House.

Question put, That the original words stand part of the Question:
	 The House divided: Ayes 189, Noes 286.

Question accordingly negatived.
	 Question, That the proposed words be there added,  put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.
	 M ain Question, as amended, agreed to.
	 Resolved,
	That this House celebrates 60 years of the NHS; recognises the support from all political parties for the NHS during that time; is grateful to NHS staff, past and present, who are the key to its success; commends their commitment and expertise in delivering patient care in often difficult circumstances; acknowledges the unique contribution of volunteers and charitable organisations; is committed to providing the NHS with the funding it needs to deliver European standards of healthcare to all; recognises an opportunity to make the NHS more patient-centred by focussing on outcomes; further recognises the defining contribution the NHS has made to the health and wellbeing of the nation since 1948; acknowledges that the principles upon which the NHS was established, funded by general taxation and free at the point of delivery, are immutable; accepts that target reductions in waiting times have significantly improved services to patients; and looks forward to the next 60 years of the NHS characterised by world-class quality healthcare as well as greater personalisation, individual choice and easier access to services.'.

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Delegated Legislation Committees),

Political Parties

That the draft Political Parties, Elections and Referendums Act 2000 (Northern Ireland Political Parties) Order 2008, which was laid before this House on 16th May, be approved. [Mr. Khan.]
	 Question agreed to.

Mr. Speaker: If it is convenient for the House, I propose to put together motions 4, 5, 6 and 7.
	 Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Delegated Legislation Committees),

Parliament

That the draft Ministerial and other Salaries Order 2008, which was laid before this House on 2nd June, be approved .

Defence

That the draft Armed Forces, Army, Air Force and Naval Discipline Acts (Continuation) Order 2008, which was laid before this House on 21st May, be approved.
	That the draft Armed Forces (Service Complaints) (Consequential Amendments) Order 2008, which was laid before this House on 21st May, be approved.
	That the draft Armed Forces (Alignment of Service Discipline Acts) Order 2008, which was laid before this House on 21st May, be approved. [Mr. Khan.]
	 Question agreed to.

european documents

Motion made, and Question put forthwith, pursuant to Standing Order No. 119(9)(European Committees),

Diplomatic and Consular Protection of Union Citizens in Third Countries

That this House takes note of European Union Document No. 5947/08 and Addenda 1 and 2, European Commission Communication, Diplomatic and consular protection of union citizens in third countries; recalls that such Communications are not legally binding; underlines that the provision of consular assistance remains a matter for Member States; and in this context, welcomes the Commission's Communication as a contribution to continuing reflections on promoting consular co-operation among EU Member States. [Mr. Khan.]

Mr. Speaker: I think the Ayes have it.

Hon. Members: No.
	 Division deferred till Wednesday 25 June, pursuant to Standing Order No. 41A (Deferred divisions).

Petitions
	  
	Post Office Closures (Leeds)

Greg Mulholland: I wish to present the petition of my constituents opposed to the closure of the post offices at Far Headingley, Bramhope and Newall.
	The petition declares that the Far Headingley, Bramhope and Newall post offices are vital resources, highly valued by the local community.
	The Petitioners therefore request that the House of Commons urges the Secretary of State for Business, Enterprise and Regulatory reform to instruct Post Office Ltd. to ensure that Far Headingley Post Office remains open.
	And the Petitioners remain, etc
	[P000220]

Whaling

David Anderson: I bring this petition to the House on behalf of the petitioners who call on the Government to do all that they can to get the world community to pressure countries such as Japan, Norway and Iceland to stop killing whales across the globe. The International Whaling Commission meets this week in Chile, and the petition calls on that body to make it clear that, when the world says no, it means noto all-out whaling, to targeted culls and to the scientific cull con. It means no to whaling full stop.
	 Following is the full text of the petition:
	 [The Petition of those concerned about whaling,
	 Declares that the situation for whales is bleak. More than 30,000 whales have been killed for commercial purposes since the International Whaling Commission (IWC) moratorium on commercial whaling came into effect in 1986, in blatant disregard of global conservation efforts. In the next 12 months Japan and Norway intend to kill around 2,000 whales, including endangered species such as fin whales.
	 Japan claims that the whaling it conducts is for scientific research. However, Japan's scientific research is simply a means to carry on commercial whaling despite the moratorium. Whaling is also extremely cruel. There is simply no way to kill a whale humanely at sea.
	 Japan has also been continuing its attempts to recruit more developing countries to the IWC in order to regain a simple majority at this year's IWC meeting in June and promote commercial whaling. If Japan were to succeed, it would be a disaster for whales. Many whale species have still not recovered from the intensive commercial whaling of the past and face many other threats such as climate change, ship strikes and pollution. It is therefore extremely important that the current pro-conservation majority at the IWC is both maintained and strengthened.
	 The Petitioners therefore request that the House of Commons urges the Secretary of State for the Department of Environment, Food and Rural Affairs, to demand that the Japanese Government end its cruel and unnecessary scientific whaling programmes; to continue and enhance his efforts, at the highest ministerial and diplomatic levels to recruit more pro-conservation countries to the IWC and to persuade those countries which currently vote with Japan to vote instead for whale conservation; and to work with other anti-whaling countries to turn the IWC into a body exclusively focused on protecting and conserving whales for future generations.
	 And the Petitioners remain, etc.]
	[P000219]

OPEN WINDROW COMPOSTING

Motion made, and Question proposed, That this House do now adjourn. [Mr. Khan.]

Michael Clapham: I am pleased to have secured this debate this evening on open windrow composting. Let me say at the outset that I support the recycling of green waste. However, it must be done in a safe manner and without endangering the safety of those who live in close proximity to recycling sites. It is in that context that I want to make two points in my contributionabout the danger associated with this type of process, and about public safety.
	I also want to take this opportunity to thank the Minister for her reply to me of 16 June 2008, which goes some way to answering some of my concerns, but I want to encourage her to go a little further. I will refer to her letter later and suggest how we may take the matter forward.
	The problems associated with open windrow composting were brought to my attention by local residents in my constituency who were protesting against the proposal for a composting site near to the village of Hood Green in the hinterland to the Pennines. I know that matters to do with the site are for the local planning authority and not for this debate, but I want to speak about the dangers generally associated with the open windrow composting process and what can be done to mitigate them.
	The process takes place on a large concrete base and the method of decay is helped by the natural internal combustion of the waste. As the green waste heats, the process of decay is facilitated. The waste is turned over by machine at intervals to ensure thorough decomposition. That agitation produces bioaerosols, which can be called organic dust. One such bioaerosol is Aspergillus fumigatus, a fungus that can cause serious respiratory damage and has been known to be fatal. There are other downsides to the process, including the odour that resultsparticularly from the run-off of rain, which can collect and stagnate. That adds to the sickening smell, which also attracts vermin and flies; they are a further hazard of the process.
	I want to draw the Minister's attention to the Giessen study, which took place in Germany; I shall read from its introduction and conclusions in a moment. I want to do that because the Environment Agency advises a 250 m precautionary buffer zone, although from its website it appears that the agency is not too sure of what the distance should be. That is an important issue.
	I contend that, on the evidence available, a 250 m buffer site is inadequate in many circumstances. In that context, I refer the Minister to a study carried out by scientists at the university of Giessen Institute for Hygiene and Environmental Medicine on the effects of bioaerosol-polluted outdoor air on the airways of residents. It is dated 14 November 2005. I am advised that, for some strange reason, the study was not included in the Health and Safety Executive review of research report 130.
	The introduction to the study states:
	A team of doctors, process engineers, microbiologists and meteorologists were assembled, and conducted this investigation into the effects of bio aerosol polluted air on the airways of residents. The study was double blinded to the ongoing microbial levels. A total of 356 medical questionnaires were collected from residents near a green waste compost site and also from an unexposed residential control area. The prevalence of health complaints were assessed against distance from site and the recorded microbiological pollution levels...The site near Giessen, Germany processes yard trimmings, grass cuttings and organic waste. The material is shredded, formed in windrows and turned regularly. Throughput is approximately 12500m(3) per year.
	The conclusions of the study are of great interest, and I want to draw the Minister's attention to them:
	There is clear evidence of elevated health changes with residents living up to 500 metres from this green waste site. Mucus membrane infections are particularly elevated, shortness of breath is shown to be an effect of spore inhalation and excessive tiredness is distinctly linked to site emissions.
	The study continues:
	This study is believed to be the first to actively show the causal link between levels of bio aerosols and health conditions. Other studies over the last 20 years have hypothesized over the effects on those living in close proximity to compost sites and have identified raised levels of fungal spores at 500 metres distant, but apart from stating that 'there is potential for chronic ill health, which may not yet have had time to manifest itself', no change in Environmental Agency recommendations for distances from sensitive receptors has yet emerged.
	The agency referred to is of course the German environment agency. It concludes in its final paragraph:
	Fungal spores are common in air and every cubic metre of air breathed will contain a few minute spores. Generally the immune system can cope with levels above background, but in the area of a composting site the concentration of airborne spores is increased dramatically. Exposure should be limited wherever possible up to the 500 metre line where background levels then descend to normal.
	In effect, the study is saying that we should have a buffer zone of 500 m. Given that it is the most comprehensive study that has been done, I am rather surprised that it was not included in the HSE review of research report 130.
	The Minister will be aware of the Stourbridge case, where, on 10 December, a composting site that was within 250 m of residential homes was closed. A man who acted as a consultant to the group that opposed the site advises me that it was closed because of excessive amounts of odour and bioaerosol emissions; I know that the Environment Agency takes a different view. He has provided me with the medical backgrounds of 12 of the 14 victims. Two of the 12 were suffering from the Aspergillus fungus; the others had picked up different infections on top of their chest conditions. Since the closure, I am advised that the five people who have been followed up have all reported that their health has improved and that they are using only half the medicines that they were prescribed at the time when the site was open. If we not only look at the Giessen study but draw on the experience gained from Stourbridge, it is clear that important evidence links the victims to the inhalation of organic dust from those composting sites.
	The Minister may be interested in the work that is being done at Sheffield university. The Environment Agency decided on its 250 m buffer zone on the basis of a study carried out on flat lands in Norfolk, but when people from Sheffield university investigated how the wind carries spores in the hinterland to the Pennines, they found that it blows up the hill and then forms a kind of vortex on the other side, carrying some of the spores up to 1 km further than was previously supposed. It is important that we take into consideration the terrain for which many composting applications are made. I understand from a similar study that the Californian authorities have decided to go with a 500 m buffer zone instead of the shorter one that was previously used.
	As the Minister will be aware, there are alternatives to open windrow processing, including complete enclosure and a system called IVCin-vessel compostingwhich operates almost like a low-pressure cooker and deals with the green waste without producing the bioaerosols.
	Problems may be created in the work environment for employees, and that issue should also be considered closely.
	The Minister wrote me a helpful letterit included one point on which we may be able to make further progressin which she referred to the development of amenity risk assessments at waste management facilities. She wrote:
	This project will help to develop methods for estimating downwind concentrations of bio-aerosols and focus on improving data availability to support research into dispersion modelling.
	As I say, dispersion modelling is being done at Sheffield university. She went on to say:
	The report will describe a number of peer reviewed journal papers examining bio-aerosol production and dispersal.
	It is in that context that I urge her to ask that the Environment Agency and the Health and Safety Executive, which has a public health function, look at the Giessen study. As far as I can see, it is the foremost study on composting in the community.
	In conclusion, I ask the Minister to do four things. First, I would like her not only to ensure that the HSE and the Environment Agency review the Giessen study, but to encourage them to take a cautious view on recommendations of a more appropriate buffer zone, particularly in areas such as the hinterland to the Pennines, where it is very hilly and we get the sort of wind problems and vortexes to which I referred. I would also be pleased if she advises that research done before 2000 is outdated, because much of the relevant literature is more recent. The Cornell Waste Management Institute, which is an Ivy league institute, is making that recommendation. Will she ask the HSE to advise on the best and safest composting method for employees and the public? Finally, will she ask local authorities to defer any proposals for new sites until the Environment Agency and the HSE advice is available so that we can ensure public safety in the future?

Joan Ruddock: I am very grateful to my hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) for securing this debate, and for the excellent way in which he presented his case. I will attempt to answer his many questions and deal with the promises that he seeks from me.
	As has been identified, open windrow composting is one of the forms of biological treatment of biodegradable waste that has increased in recent years in the move increasingly to recycle or recover waste and to reduce our reliance on landfill. Of course, however, composting is by no means new and it is, indeed, a process that occurs naturally, as my hon. Friend will appreciate. Good quality compost has a number of benefits, including its water-holding capability and as a sustainable alternative to peat, so it is important to us. It returns organic matter to the soil, sequestering carbon, and it can be used as a soil improverin agricultural or landscape applications, for exampleand as a growing medium for the horticultural industry.
	At the heart of our waste strategy is the need to meet our European Union landfill directive targets. The amount of biodegradable municipal waste we send to landfill needs to fall to 11.2 million tonnes by 2010, 7.46 million tonnes by 2013 and 5.22 million tonnes by 2020. That is quite a challenge. We have already made progress, with the amount falling from 13.9 million tonnes in 2004-05 to 11.55 million tonnes in 2006-07. That achievement reflects the increase in waste being recycled and compostedfrom 27 per cent. in 2005-06 to more than 30 per cent. in 2006-07. A third of that figure is made up of composting.
	Open windrow composting is the form of composting green waste that is carried out in our back gardens, our community composting schemes, in large public gardens and hotels, on farms and at other establishments. Composting is also carried out on a much larger commercial scale by operators contracted to handle source-segregated green waste collected by local authorities or delivered by the public to civic amenity sites.
	Open windrow composting is less suited to dealing with other types of waste such as food waste or other contaminated biodegradable waste. As my hon. Friend said, other methods are more appropriate, for example, in-vessel composting, which must fulfil animal by-product regulations, and anaerobic digestion. The Government are encouraging that and we have announced a 10 million technology demonstrator programme for anaerobic digestion.
	At the core of my hon. Friend's concerns are the risks that such activities pose to the environment and human health. As he said, a bioaerosol is a suspension of fine biological material in a gas. Bioaerosol particles are made up of a range of different types of particles, including fungal spores such as Aspergillus fumigatum and Penicillium. Of course, they occur naturally in urban and rural environments, and can aid the composting process.
	It is important to stress that background figures vary from location to location, and with the seasons, ranging from less than 100 to more than several thousand particles per cubic metre. My hon. Friend is correct to say that the dispersal of bioaerosols will vary with atmospheric conditions. That is why the Health and Safety Executive reviewed a range of data from different sites, conditions and modelling techniques. My hon. Friend asked why the Giessen study was not included in the review. The reason is that the review was carried out before the publication of the Giessen study, so its inclusion was not possible.
	The review, which was published in 2003, found that fungal particles generated at any site would drop to background levels within about 150 m. That is why the Health and Safety Executive has proposed a precautionary approach and recommended not 150 m but 250 m. By taking a bigger margin than is perhaps considered necessary, the HSE is confident that it has taken account of unexpected or extreme conditions.
	My hon. Friend asked about specific wind speeds and dispersal. That works in a way that perhaps is contrary to his expectations. When the tiny particles are in the wind, if they are blown at speed in a specific location, they are more likely to clump together, form heavier particles and therefore fall to the ground more quickly. Of course, we would expect particles to travel as far as 1,000 m. They are being constantly spread throughout the atmosphere.

Michael Clapham: I accept that a gentle wind in a level area may take the spores further than a stronger breeze. However, in the Pennines, the modelling showed that the wind goes to the top of the hills and forms a vortex over them, carrying the spores much further and putting communities that are further away than 250 m in danger. I therefore believe that we should have a wider buffer zone.

Joan Ruddock: My advice is that that dispersal mechanism reduces the density. Between us, we are unable to decide, so we probably need to leave the matter to the experts, but that is the advice that I have received.
	The Environment Agency recently reviewed the 250 m limit, in the light of our recent increases in composting capacity, and concluded that it remained valid. Therefore, I am afraid that the Government cannot accept my hon. Friend's suggestion that all composting schemes throughout the country should be deferred until further research has been conducted. There are further research projects under way, which I shall mention, but he knows that I have given him chapter and verse on those, including their publication date and what they aim to achieve, in the letters that I have sent him.
	All forms of waste recovery or disposal, including composting, are regulated to prevent harm to human health and the environment. That regulation is achieved in two ways: first, through the planning system and the requirement for planning permission for use or development of land; and, secondly, through an environmental permit, or in some cases a registered exemption from the Environment Agency. The aim is for the two systems to complement each another to achieve the overall control and protection required.
	The Environment Agency is consulted, as part of the planning process, on environmental and human health considerations and, where composting sites are involved, takes the location of the site into account when permitting a site or registering an exemption. The Environment Agency requires permit applicants and those wishing to register exemptions to provide it with a site-specific bioaerosol risk assessment where the proposed composting facility will be within 250 m of dwellings or workplaces. That assessment will need to demonstrate that the levels of bioaerosols have dropped to background levels before reaching the first receptor, which means dwelling or workplace. Where prospective compost sites are more than 250 m from occupied premises, a more basic risk assessment is completed that does not require monitoring of bioaerosols, for the reasons that I have already given.
	My hon. Friend referred in his correspondence to the site at Hood Green, which is just over 300 m from the nearest house. The nearest workplace is 210 m away, but is an unstaffed sewage treatment works. The prospective operator was required to submit only a basic risk assessment, as part of a registration process for the waste exemption. That assessment determined that the risk was acceptable, given the distance of the site from the nearest dwelling. That meets the Environment Agency's requirements for assessing exemption registrations when sites are more than 250 m from a dwelling or workplace.
	It is a fundamental principle of the planning system that each application must be decided on its individual planning merits, following consultation with those potentially affected by a development. As my hon. Friend has acknowledged, given that there is an outstanding application for planning permission in respect of the Hood Green site, it would be inappropriate for me to comment further at this stage. However, I understand that the occupier of the site has already registered an exemption with the Environment Agency in respect of the proposed composting operation. The Environment Agency has advised me that it has considered the request in detail and has checked the proposed composting activity could meet the terms of the exemption before placing it on the public register of exempt activities.
	Under the terms of the current exemption provided for in legislation, the amount of waste being composted at any time must not exceed 1,000 cu m. The Environment Agency has advised me that it will inspect the site if it becomes operational. If the Environment Agency finds that the site is causing harm to the environment or resulting in noise or odour nuisance, it can remove the exemption from the register. The Environment Agency can also take enforcement action, but only if there are any grounds to do so once the activity has commenced. If the composting activity is unable to meet the requirements of the exemption and is removed from the public register, the operator will be required to apply for an environmental permit to carry out the activity. The site will be subject to inspection by the Environment Agency to ensure that the operations are being carried out to an appropriate standard and in compliance with the rules of the exemption.
	My hon. Friend referred to the composting site in Stourbridge. In that case, the Environment Agency refused to register an exemption because of its concerns about nuisance and other local impacts. I have checked the details specifically in relation to bioaerosols, and the Environment Agency has said that they were not the reason for closing the site. The reasons were dust, noise and smells, all of which have an impact on local people, and it was as a consequence of those factors that the agency exercised its enforcement powers. I understand that bioaerosol monitoring has taken place at the site, and they were not one of the factors involved. It is really important to assure people of that.
	My hon. Friend referred to the follow-up research that he says has been carried out. I have not seen it, but if there is value in the work, we will undoubtedly need to look at it. The Environment Agency and others who are carrying out research and producing reports will clearly need to look at it as well. My hon. Friend has described a very small sample, however. As a scientist myself, I think that it might be difficult to draw conclusions from a sample of that size.

Dan Norris: I share many of the concerns that my hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) has expressed, in relation to my own constituency. I hope that the Minister will refer to the research that he has mentioned, as I believe that it could have an impact on the decisions that she might ultimately make.

Joan Ruddock: May I give my hon. Friend, and my hon. Friend the Member for Barnsley, West and Penistone, that assurance? I am determined to look into all the issues that have been raised. As I said in my letters, if the research throws up new factors, it will of course be appropriate to review the situation, and we will have to look at the conditions surrounding the permits and exemptions
	 The motion having been made after Ten o'clock, and the debate having continued for half an hour, Mr. Speaker  adjourned the House without Question put, pursuant to the Standing Order.
	 Adjourned at thirteen minutes to Eleven o'clock.